Please assume regarding this question that you are an advisor to your Client, a wealthy individual. On March 1, 2022, your Client informs you that they invested in a corporation that holds cryptocurrencies. Your Client told you that they contributed $200,000 in cash towards forming the corporation, named IBX, and received 80,000 shares of IBX, making them an 80% shareholder.

Your client wants to know what tax liability they will have with receiving the 80,000 shares of IBX in exchange for the $200,000 that they paid and the 80% shareholder ownership in IBX. Assume that there are only 2 shareholders of IBX after the corporate formation, and that your Client and the other shareholder own 50% equity each. Please discuss the possible tax consequences to your client.