R and J form a C corporation with equal shares. R transfers $4,000 cash in return for 4,000 shares of stock worth $4,000. J transfers property to the corporation in return for 4,000 shares of stock worth $4,000. J’s tax basis in the property at the time of the contribution was $1,000 with a fair market value was $7,000. It was subject to a liability of $2,000, which the corporation assumed. J purchased the property 4 years ago.
a. What is J’s amount realized?
b. What is J’s gain realized?
c. What is J’s gain recognized?
d. What is J’s tax basis in her stock?
e. What is J’s holding period: tacks or new?
f. What is the corporation’s tax basis in the property?