Joe contributed assets to Yellow Corporation in a valid IRC 351 contribution: Asset Basis FMV Land $350,000 $250,000 Equipment $100,000 $150,000 Total $450,000 $400,000 16 Months after the contribution, Yellow liquidates and distributes the assets to Joe. At the time of liquidation, the Land was worth $200,000. Joe owns less than 50% of Yellow. Yellow will recognize a loss of $0 $150,000 $100,000 $50,000