Joe and Sunny intend to enter into a business venture together and decided that an S corporation would be a desirable entity choice for federal income tax purposes. The corporation is named JS Inc. (JS). For newly established JS, Joe intends to contribute Property A with a fair market value (FMV) of $800 and basis of $300. Sunny intends to contribute cash of $800.

Now assume that Joe receives cash of $300 and stock for his contribution of Property A with a FMV of $300 and basis of $800.

62. Provide Joes basis in JS upon contribution.

63. Provide JSs basis in Property A immediately after the contribution.

Now assume that Joe transfers the following assets to JS in exchange for the stock.

Adjusted Basis FMV

Equipment $100,000 $90,000

Land $200,000 $230,000

Building $150,000 $100,000

64. Provide Joes basis in JS upon contributions.

65. Provide JSs basis in Property A immediately after the contribution.