option B is correct. As per section 386 (c) control means that atleast 80% shares are held by an individual. As none of are holding 80% shares the transactions will not qualify for code sec 351
Doug, Elbert, and Fran form DEF Corporation by transferring the following: From Transferor Property Transferred Stock...
Same Scenario as prior question for DEF Corp. Doug, Elbert, and Fran form DEF Corporation by transferring the following: Stock Received From = Transferor Property Transferred 10-Year Notes Doug $75,000 $75,000 $0 Elbert $25,000 $25,000 $0 Fran $25,000 $0 $25,00 Woul Does the above transfer qualify Fran for nonrecognition of gain or loss under Code Sec. 351? O A. Yes, control was obtained in the transfer. B. Yes, transfers to start a corporation are always allowed to exclude gains in...
QUESTION 1 Alley, Bob, and Cain form ABC Corporation by transferring the following: From = Transferor Property Transferred Services Transferred Stock Received Alley Equipment $40,000 $40,000 Bob Land $38,000 $0 $38,000 Cain $0 $22,000 $22,000 Would the above transfer qualify A and B for nonrecognition of gain or loss under Code Sec. 351? Why?
Tom and Gail form Owl Corporation with the following consideration: Consideration Transferred Basis to Transferor Fair Market Value Number of Shares Issued From Tom— Cash $50,000 $50,000 Installment note 240,000 350,000 40 From Gail— Inventory 60,000 50,000 Equipment 125,000 250,000 Patentable invention 15,000 300,000 60 The installment note has a face amount of $350,000 and was acquired last year from the sale of land held for investment purposes (adjusted basis of $240,000). Regarding these transactions, provide the following information: If...
Tom and Gail form Owl Corporation with the following consideration: Consideration Transferred Basis to Transferor Fair Market Value Number of Shares Issued From Tom— Cash $50,000 $50,000 Installment note 240,000 350,000 40 From Gail— Inventory 60,000 50,000 Equipment 125,000 250,000 Patentable invention 15,000 300,000 60 The installment note has a face amount of $350,000 and was acquired last year from the sale of land held for investment purposes (adjusted basis of $240,000). Regarding these transactions, provide the following information: If...