Frank Brower is the president and sole shareholder of Sterling Corporation. Sterling was incorporated in 1995 and primarily buys used cars and resells them. Frank has stock basis in his shares of Sterling of $500,000. In November 2011, Sterling transferred its entire inventory of cars to Frank for $1.9 million, fair market value of the cars (Basis of $1 million). The October Board of Directors Minutes document the board approval of the sale of the assets. The minutes state that Frank is required to pay the corporation the proceeds at some point in the future. There is no promissory note and Frank has made no payment to date. After the transfer of the inventory, Sterling ceased operations but did not formally liquidate under state law. The IRS audited the 2011 return and determined that the sale of the inventory was actually a liquidation of Sterling. They assessed a gain of $900,000 on Sterling due to the liquidation. Sterling doesn't have any assets to pay the tax and as such the IRS assessed the tax on Frank. Additionally, the IRS opened up Frank's personal return and included a gain on the liquidation of the Sterling shares. Frank has hired you to review the IRS assessments and to provide guidance on what he should do. Write a memo to Frank discussing these issues.