said that the distribution of NRZ's shares would be a taxable distribution! Not sure why all the discussion on whether or not it would be taxable. They have said it would be.
What remains for discussion is how much of that distribution would be taxable. If we assume that there is no earnings and profits, only the earnings and profits generated from the distribution would be taken into account. When a corporation distributes assets (NRZ contains assets and the distribution of its stock is essentially a distribution of assets) unless it can fall under Sec. 355, gain or loss will be recognized. Gain will be equal to FMV of assets less their bases. Again, assuming no earnings and profits (or current loss), this is the potential amount that the distribution would be taxable. If there are other earnings and profits, then up to the full FMV could be taxable. But that situation is remote IMHO. Other distributions throughout the year should also use up some E & P.