On liquidating a
Then, the shareholders are treated as exchanging their stock for the FMV of the assets distributed in complete liquidation, with the resulting gains or losses at the shareholder level.
When determining whether a closely held corporation should be liquidated, the tax consequences to the shareholders should be considered.
Assets are distributed based on the priority of various parties’ claims, with a trustee appointed by the Department of Justice overseeing the process.
The most senior claims belong to secured creditors, who have collateral on loans to the business.
The debts still exist in theory, at least until the statute of limitations has expired, but there is no debtor to pay them, so they must be written off in practice.
Otherwise, any amounts attributable to investment income will be taxed and penalized.
Evaluate whether you need to liquidate the entire IRA.
Liquidation is the process of bringing a business to an end and distributing its assets to claimants.
Once the process is complete, the business is dissolved.