Red Corporation wants to set up a manufacturing facility in a midwestern state. After considerable negotiations with a small town in Ohio, Red accepts the following offer: land (fair market value of $3,000,000) and cash of $1,000,000. If an amount is zero, enter "0". a. How much income, if any, must Red Corporation recognize? b. What basis will Red Corporation have in the land? Red Corporation will have a basis of $ in the land. C. Assume that in addition to the facts given, the small town offers to reduce the established property tax rate by 40% on new assets acquired by Red during the two-year period after locating in the town. What are the Federal income tax consequences of the property tax abatement? When a municipality grants a tax abatement to a corporation for locating in the jurisdiction, the abatement considered a contribution to capital. In addition, it taxable