Julian, berta, and maria own 400 shares, 400 shares, and 200 shares, respectively, in caramel corporation (e & p of $750,000). berta is julian’s sister, and maria is julian’s aunt. caramel corporation redeems all of julian’s stock for $420,000. julian paid $200 a share for the stock five years ago. julian continued to serve on caramel’s board of directors after the redemption. with respect to the redemption:
a. is this a disproportionate redemption?
b. how much dividend income must julian report?
c. how much long-term/short term capital gain must julian report.