An S Corporation Distributes Land with a Basis of $60,000

Multiple Choice

An S corporation distributes land with a basis of $60,000 and a FMV of $90,000 to its shareholders. The tax results of the distribution will be

A) no gain to the corporation or to the shareholders.
B) $30,000 of gain recognized by the S corporation and no pass through to the shareholders.
C) no gain recognized by the corporation but $30,000 of gain recognized by the shareholders.
D) $30,000 of gain recognized by the S corporation which is passed through to the shareholders.