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95.At the start of the year, the sole shareholder in an s-corporation has a basi

ID: 2431473 • Letter: 9

Question

95.At the start of the year, the sole shareholder in an s-corporation has a basis of $50000. During the year, the S-corporation earns $40000 in non-separately stated income, gives the shareholder a distribution of $20000 and receives a cash loan from the shareholder of $100000. What is the shareholder's stock basis in the s- corporation at the end of the year?

A.70000
B.90000
C. 0
D. 190000

An individual contributes three properties to a corporation in a 351 exchange. The first property has a basis of $10000, and fair market value of $50000. The second property has a basis of $100000, and fair market value of $85000. The third property has a basis of $50000, and fair market value of $80000. The third property was pledged as security for a loan of $200000 which the corporation assumes. The individual's stock basis after the transfer is:

A. 0 B. 160000 C. 215000 D. 200000

An individual contributes property with a basis of $10000, and fair market value of $20000 to a corporation in return for 50% of the corporation's stock. The individual is the only transferor in the transaction. The individual's stock basis after the transfer is:

a 30000 b 10000 c 20000 d 40000

Explanation / Answer

95. Basis would be $ 50000 + $ 40000 = $ 90000. Since he is a sold shareholder whole amount shall be taken into consideration rather than the distribution made.

96. Basis would be $ 10000 + $ 100000 + $ 50000 = $ 160000 (Option B)

97. Basis in the property transferred that is $ 10000