Case summary Essay Example | Topics and Well Written Essays - 500 words - 2

Case summary - Essay Exampleb) There was no distribution of current and/or accumulated earnings and profits. It can be determined that TWC did not redirect actual value to the petitioner by impuissance to charge its normal profit margin when receiving the reimbursement.a) Even though it is not the courts mandate to construct and inform arguments for the parties involved, it could clearly determine that the clock of respondents constructive dividend adjustment is highly inappropriate and untimely. TWC was reimbursed for its work during 2004 and 2005 while the petitioners relocated into the home in 2005 (Johnson, 502). Therefore, if there was any constructive dividend that had been accepted then it would have been received, and therefore brought up in 2004 and/or 2005, not 2006.b) According Section 316(a) a dividend is any allocation of property that a fast(a) makes to its stockholders from its earnings for the trading period and profits retained from the past periods (Johnson, 501). TWC did not make any profit or earnings from the transaction with Mr. Welle for the construction of his home.c) Ault and Arnold right argue that a constructive dividend usually arise when a corporation awards an economic benefit, specifically earnings and profits, on a stockholder without the expecting any requital or adequate consideration for the same (360).d) Not all business expenditure by an incorporated company that bestows some economic benefit on a stockholder can be termed as constructive dividend (Ault and Arnold, 358). Loftin & Woodward, 577 F.2d at 1215.e) Respondent did not elucidate how a the decision to forego profits, especially when the stockholder reimburses the corporation in full for its services, results in distribution of property which reduces the earnings and or profits as envisaged in section 316(a). The respondent also failed to realize the assertions with a credible case that sets precedent.f) Incidental or insignificant use of corporate property does not justify