Question
Martha and Tom form the MT Corporation, with a transfer of the following properties: Martha $1,200,000 cash Tom $800,000 FMV property $300,000 tax basis Martha
Martha and Tom form the MT Corporation, with a transfer of the following properties:
Martha $1,200,000 cash
Tom $800,000 FMV property
$300,000 tax basis
Martha will receive 60% and Tom 40% of the corporate stock.
Complete the following
Martha Tom
Realized gain _______ ________
Recognized gain _______ _______
Basis of Stock _______ _______
MT basis in contributed asset _______ _______
VARIATION 1: return to original facts (no Karla). Tom’s property is valued at $1,100,000 but is contributed subject to a $300,000 liability.
Complete the following
Martha Tom
Realized gain ________ ________
Recognized gain ________ _________
Basis of stock _________ _________
MT basis in contributed asset __________ _________
VARIATION 2: Same as Variation 1 except Tom’s property is valued at $1,200,000 and is contributed subject to a liability of $400,000.
Step by Step Solution
3.49 Rating (159 Votes )
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started