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For the built-in loss limitation to apply, the property must have been acquired by the corporation...

For the built-in loss limitation to apply, the property must have been acquired by the corporation as part of a plan whose principal purpose was to recognize a loss on the property by the liquidating corporation. Explain.

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if property is transfered to a corporation with a built in loss meaning adjusted basis in thr corporations hands is greater than its fair market value, the property basis in the corporation hands is its FMV. This is called loss importation rule.

Loss importation property exists if a transferor gain or loss on a sale of individual property immediatelt befire the transferor would not be subject to federal income tax and also the acquir8ng corporations gain or loss on a sale of the transferred property immediately after the transfer would be subject to federal income tax.

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