• Create a scenario where the transfer of property to a controlled corporation under Section 351 of the Internal Revenue Code (IRC) results in taxation to the transferor. Speculate as to the reasons that gain treatment in the current year may be preferred to the deferral of gain. Provide a tax-planning strategy.

No gain or loss is recognized on the transfer of assets from one corporation to another for stock or securities of the transferee corporation as long as the transferor owns 80% of the transferee's stock after the transaction.