Question 1) What is a carryover basis as it relates to property received by a corporation in a 351 transaction? What is the purpose of attaching a carryover basis to property received in a 351 transaction? Under what circumstances does property received by a corporation in a 351 transaction not receive a carryover basis? What is the reason for this rule? What is a substituted basis as it relates to stock received in exchange for property in a 351 transaction? What is the purpose of attaching a substituted basis to stock received in a 351 transaction?