Today I conferred with Jacob Corcoran regarding his letter of February 10th. Two years ago, Mr. Corcoran purchased 10,000 shares of Grebe Corporation for $24,000. Last year, he received a nontaxable stock dividend of 2,000 additional shares. He sold the 2,000 shares this year for $18,000 and has asked me to determine the tax consequences of the sale. Issue: How is the gain or loss determined on the sale of shares of stock received as nontaxable stock dividends determined, and how is it taxed