Question

14. For Section 351 transfers, immediately after the exchange a. requires simultaneous transfer, if two or more transferors b. allows transfers to occur up to two years apart c. allows transfers to occur up to three years apart d. means that transfers should occur as close together as possible e, none of the above 13. Section 351 transfers for property and services are acceptable as long as the property value is at least a. 5% of the value of services provided b. 10% of the value of services provided c. 15% of the value of services provided d. 20% of the value of services provided e. 50% of the value of services provided 16. Generally, the assumption of a liability by the acquiring corporation will not produce boot to the transferor-shareholder in a $ 351 transaction a. However, liabilities assumed by the corporation are treated as "other property or money" b. However, the basis of stock received must general be reduced by the amount of the liabilities assumed c. However, if there is no bona fide business purpose behind the exchange, the liabilities will be treated as boot d. All of the above are true c. None of the above are true 17. In a $ 351 transfer where no gain is recognized, a, the depreciation recapture rules cause gain to be recognized immediately b. recapture potential associated with the property carries over to the corporation c. recapture potential associated with the property disappears d. recapture occurs at the time of transfer of the property e, none of the above 18. The tax treatment of corporate distributions at the shareholder level does not depend on: a. The character of the property being distributed. b. The earnings and profits of the corporation. c. The basis of stock in the hands of the shareholder. d. Whether the distributed property is received by an individual or a corporation e. None of the above. 19. Which of the following statements is incorrect with respect to determining current E & P? a. All tax-exempt income should be added back to taxable income. b. Dividends received deductions should be added back to taxable income. c. Current year charitable contributions in excess of the 10% of taxable income limit should be subtracte from taxable income. d. Federal income tax refunds should be added back to taxable income. e. None of the above statements are incorrect.
14-19 please

Answer 1

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Answer 14

Option a.

Though Sec 351 does not provide the time period but it requires simultaneous transfer in case of two or more transferors.

Answer 15

Option b.

It should be at least 10% of the value of services provided.

Answer 16

Option b.

As per Sec 351 the liabilities are generally reduced from the basis of stock.

Answer 17

Option b.

As per sec 351 gains should not be recognized immediately after transfer. So recapture potential associated with the property carries over to the corporation.

Answer 18

Option a.

Because though the character of distributed property may impact the tax treatment of gain recognized by corporation but it will not have any impact on the shareholder.

Answer 19

Option e.

All of the options from a to d is correct.