In the current year, Matt, Jona, Sue, and form Corporation. contributes land (a capital asset) having a FMV in exchange for shares of stock. He purchased the land three years ago for. contributes machinery (Sec. 1231 property purchased four years ago) having a adjusted basis and a FMV in exchange for shares of Greek stock. contributes services worth in exchange for shares of stock.

Requirement a. What is the amount of 's recognized gain or loss?

Matt realizes a $62,500 loss and recognizes no gain or loss.

Requirement b. What is 's basis in his shares? When does his holding period begin?

Matt's basis in the Greek shares is $125,000 and his holding period for the stock is deemed to begin

three years ago when Matt originally purchased the land.

Requirement c. What is the amount of 's recognized gain or loss?

Jona realizes a $77,500 loss and recognizes no gain or loss.

Requirement d. What is 's basis in his shares? When does his holding period begin?

Jona's basis in the Greek shares is $115,000 and his holding period for the stock is deemed to begin

four years ago when Jona originally purchased the machinery.

Requirement e. How much income, if any, does recognize?

Sue realizes a _______ gain/loss and recognizes ordinary income/capital income

of ___________