Alan, Barbara, and Joy have decided to set up FT Corporation. Alan plans to contribute $50,000.

Barbara plans to contribute a warehouse located in upstate NYS that originally costed her $25,000, but

she made improvements costing $25,000 and now has a FMV of $100,000. Joy doesnt know if she

should contribute $50,000 or contribute $25,000 and as she is a lawyer, provide services in the amount

of $25,000 to have an equal amount contributed as everyone else. They have come to you for advice on

this and the taxability and basis of each party.

Further, FT Corporation plans on buying kitchen machinery in the amount of $100,000 and taking out a

loan in year one of business. What advice would you give Alan, Barbara, Joy and FT Corporation?

Furthermore, FT Corporation plans on operating out of Syracuse, NY. The shareholders want to know if

there is a corporate income tax filing obligation associated with this decision.

Lastly, Alan asks if the bribe he had to pay to the state official for tax credits in NYS is deductible on the

income tax return.

The memo is not to exceed 1,000-words and shall provide citations (citations dont factor into the word

count). Anything over the 1,000-word count will not be considered in grading.

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