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Orange Corporation purchased purchased bonds (basis of $185,000) of its wholly owned subsidiary, Green Corporation, at a premium. Upon liquidation of Green pursuant to section
Orange Corporation purchased purchased bonds (basis of $185,000) of its wholly owned subsidiary, Green Corporation, at a premium. Upon liquidation of Green pursuant to section 332, Orange receives payment in the form of land worth $200,000, the face amount of the bonds. Green had a basis of $220,000 in the land. What are the tax consequences of this land transfer to Green Corporation and to Orange Corporation? This question has to do with advanced federal taxation
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