If we transfer appreciated property to a controlled corporation and receive in exchange nonqualified preferred stock then gain should be recognized in the hands of transferor.
Hence in the present case, the statement is TRUE
The receipt of nonqualified preferred stock in exchange for the transfer of appreciated property to a...
When a taxpayer transfers property subject to a mortgage to a controlled corporation in an exchange qualifying under § 351, the transferor shareholder’s basis in stock received in the transferee corporation is increased by the amount of the mortgage on the property. True or False? Please explain.
Sammy and Artie make transfers to a controlled Corp. Sammy transfers $10,000 in appreciated property and received $10,000 in stock. Artie transfers his services and receives $10,000 in stock . Which is true? a.). Artie is not taxed on the receipt of stock b.). Artie is taxed on $10,000 of compensation income c.). Sammy nd Artie have a different basis in their stock d.) Sammy recognizes gain on the transfer
Q:3 Beth forms Lark Corporation with a transfer of appreciated property in exchange for all of its shares. Shortly thereafter, she transfers half her shares to her son, Ted. Will the transfer to Ted cause the original transfer to be taxable? Please explain.
When a transferor contributes property to a corporation in exchange for stock in the corporation, and the transaction qualifies under section 351 the transferor takes what kind of basis in the stock? a. transferred basis b. exchanged basis c. substituted basis d. both a and b e. both b and c f. both a and c
(13) Identify which of the following statements is true. A) If stock and boot property are both received in a Sec. 351 exchange, the transferor must allocate the total basis in the contributed property between the stock and boot property based on the relative FMVs of the stock and the boot property. B) The adjusted basis of stock received in a Sec. 351 transaction is computed by deducting the deferred loss from the FMV of the stock received. C) The...
Kate transfers to her controlled corporation property with an adjusted basis of $10,000 in exchange for stock of the corporation with a fair market value of $8,000, $3,000 cash, and the assumption by the corporation of the indebtedness of Kate amounting to $4,000. Note: Type answers in the following format 1,000 no $ but use commas. a. What is Kate's realized gain? b. What is Kate's recognized gain? c. What is the corporation's basis for the property received? d. What...
Wilbur transfers property valued at $100,000 (basis = $70,000) to the Debold Corporation in exchange for 100 percent of its stock. What is Wilbur’s realized gain or loss on the transfer and his recognized gain or loss? What is his basis in the stock received? What is the corporation’s basis in the property received?
Doug, Elbert, and Fran form DEF Corporation by transferring the following: From Transferor Property Transferred Stock Received 10-Year Notes Doug $75,000 $75,000 $0 Elbert $25,000 $25,000 $0 Fran $25,000 $0 $25,00 Would Does the above transfer qualify Doug and Elbert for nonrecognition of gain or loss under Code Sec. 351? A. No, the note disqualifies the transfer. B. No, control was not obtained in the transfer. C. Yes, the note is not considered stock and control is obtained D. Yes,...
14-19 please 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...
Question 2 3.03 points Save Answer Identify which of the following statements is true. A corporation must recognize a loss when transferring noncash boot property that has declined in value and its stock to a transferor as part of a Sec. 351 exchange Section 351 provides for nonrecognition of gain for the transferee corporation when it distributes appreciated and that is boot property to a shareholder The transferee corporation's holding period for assets acquired in an exchange meeting the Sec....