Billy transfers land with a basis of $40,000 to Webb Corporation in exchange for 100% of Webb's stock. At the date of the transfer, the land had a $30,000 fair market value. Billy makes an election to reduce his basis in Webb's stock to $30,000, so Webb's basis in the land is $30,000 $35,000 O $40,000 none of the above

Billy transfers land with a basis of $40,000 to Webb Corporation in exchange for 100% of Webb's stock. At the date of the transfer, the land had a $30,000 fair market value. Billy makes an election to reduce his basis in Webb's stock to $30,000,50 Webb's basis in the land is $30,000 $35,000 $40,000 none of the above