Problem #2 Sara and Jose form a new corporation by transferring the following in exchange for stock: Description Equipment Land Sara Adj. Basis 50,000 250,000 Received 75 Shares $ FMV 75,000 255,000 S Jose Management Services Equipment 75,000 10,000 25 Shares 2,000 Total $ 302,000 S 415,000 Notes: (1) Sara also receives a $75,000 Note from the corporation. (2) Jose agrees to provide one year of management services. Questions: a. Does this transaction qualify as an IRC $ 351 transaction? Explain your answer. b. What are the tax consequences for Sara? c. What are the tax consequences to the corporation? Problem #2 Sara and Jose form a new corporation by transferring the following in exchange for stock: Description Equipment Land Sara Adj. Basis 50,000 250,000 Received 75 Shares $ FMV 75,000 255,000 S Jose Management Services Equipment 75,000 10,000 25 Shares 2,000 Total $ 302,000 S 415,000 Notes: (1) Sara also receives a $75,000 Note from the corporation. (2) Jose agrees to provide one year of management services. Questions: a. Does this transaction qualify as an IRC $ 351 transaction? Explain your answer. b. What are the tax consequences for Sara? c. What are the tax consequences to the corporation