82.Bob transfers property in a §351 exchange with an adjusted basis of $10,000 i
ID: 2431424 • Letter: 8
Question
82.Bob transfers property in a §351 exchange 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 indebtedness of $4,000. The indebtedness assumed by the corporation was loan that Bob took out to pay his individual income taxes in a prior year. What is the gain recognized on the transfer? A. $0, since this transfer is subject to the non-recognition rule of §351 B. $5,000 C. $4,000 D. $10,000
83.John transfers property to ABC corporation in a §351 exchange. The property transferred was real estate previously used in John’s business. John held the real estate for 8 months prior to transferring the real estate to the corporation in the §351 exchange. What is John’s holding period of his ABC stock on the date of the §351 transfer? A. 0 B. 1 Day C. 8 Months D. None of the above
84.Jack and John exchange inventory and machinery with a combined basis of $100,000 and a fair market value of $500,000 to ABC corporation in return for 100% of its stock. Prior to a §351 transaction, Jack and Jill agreed that Jack would sell Jill his 50% interest in ABC corporation within one week of obtaining the shares. How much gain or loss is recognized by Jack and John combined on the §351 exchange? A. $500,000 B. $200,000 C. $400,000 D. $0, since this transfer is subject to the non-recognition rule of §351
85.Alan, Bob and Carly create a corporation. After the incorporation, Alan receives 25% of the corporation’s stock in exchange for services and intangibles. The stock was valued at $150,000. The services were valued at $125,000 and the intangibles were valued at $25,000. Bob and Carly receive the remaining 75% of the corporation valued at $450,000 in exchange for equipment with basis of $200,000 and a fair market value of $400,000. How much gain will Bob and Carly recognize on the §351 exchange? A. $250,000 since the Alan did not transfer property for stock B. $0, since this transfer is subject to the non-recognition rule of §351 C. $150,000 D. $200,000
82. Bob transfers property in a 8351 exchange 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 indebtedness of $4,000. The indebtedness assumed by the corporation was loan that Bob took out to pay his individual income taxes in a prior year. What is the gain recognized on the transfer? A. S0, since this transfer is subject to the on-recognition rule of $351 B. S5,000 C. S4,000 D. S10,000 83.John transfers property to in a $351 exchange. The property transferred was real estate previously used in John's business. John held the real estate for 8 months prior to transferring the real estate to the corporation in the § 351 exchange. What is John's holding period of his ABC stock on the date of the $351 transfer? A. 0 B. 1 Day C. 8 Months D. None of the above 84.Jack and John exchange inventory and machinery with a combined basis of $100,000 and a fair market value of S500,000 to ABC coeporation in return foe 100% of its stock. Prior to a 351 transaction, Jack and Jill agreed that Jack would sell Jill his 50% interest in ABC corporation within one week of obtaining the shares. How much gain or loss is recognized by Jack and John combined on the 8351 exchange? A. SS00,000 B. S200,000 C. $400,000 D. SO, since this transfer is subject to tbe on-recognition rule of $351 85.Alan, Bob and Carly create a corporation. After the incorporation, Alan receives 25% of the corporation's stock in exchange for services and intangibl was valued at $1S0,000. The services were valued at S125,000 and the intangibles were valued at $25,000. Bob and Carly receive the remaining 75% of the corporation valued at $450,000 in exchange for equipment with basis of $200,000 and a fair market value of $400,000. How much gain will Bob and Carly recognize on the g351 exchange? A. $250,000 since the Alan did not trans fer property for stock B. S0, since this transfer is subject to the on-recognition rule of $351 C. SI 50,000 D. S200,000Explanation / Answer
82. A. $0, since this transfer is subject to the non-recognition rule of §351
83. 8 months. holding period include holding period prior to transfer to ascertain whether gain is long term or short term (Option C)
84.$ 200000 (Option B)
85. Option B, since the transfer is under section 351. They have transferred equipment in lieu of stock which is allowed.
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