I:16-49 Corporate Formations: Transfer of Liabilities. In a transaction that meets the requirements of Sec. 351, Matt transfers to Hill Corporation land with a $600,000 adjusted basis and a $1,000,000 FMV that was used in his business. The land is subject to an $800,000 mortgage, which Hill assumes. Matt receives 100% of Hill stock.

a. What amount and character of gain or loss are recognized by Matt?

b. What is Matt’s basis in the Hill stock?

c. What is Hill’s basis in the land?