McGraw-Hill's Taxation of Business Entities 3rd Edition by Connie Weaver, Brian Spilker, Edmund Outslay, John Robinson, Ronald Worsham, Benjamin Ayers, John Barrick

Exercise 13

Cathy, Heathcliff, and Isabelle are equal shareholders in Wuthering Heights (WH), an S corporation. Heathcliff has decided he would like to terminate the S election. In the following alternative scenarios, indicate whether the termination will occur and indicate the date if applicable (assume no alternative termination dates are selected).
a. Cathy and Isabelle both decline to agree to the termination. Heathcliff files the termination election anyway on March 14, 2011.b. Isabelle agrees with the termination, but Cathy strongly disagrees. The termination is filed on February 16, 2011.c. The termination seems to be the first thing all three could agree on. They file the election to terminate on March 28, 2011.d. The termination seems to be the first thing all three could agree on. They file the election to terminate on February 28, 2011.e. Knowing the other two disagree with the termination, on March 16, 2011, Heathcliff sells one of his 50 shares to his maid, who recently moved back to Bulgaria, her home country.