Rose bought a piece of land 3 years ago for $1. Today the fair market value is $100 and she

transfers it to Flower Inc, a corporation, in exchange for all 100 of Flowers voting common stock. There are no other shareholders.

a) Does Rose recognize gain on the transfer?

b) What is Roses basis in the stock?

c) What is Roses holding period in the stock?

d) What is Flowers basis in the land?

e) What is Flowers holding period for the land?

f) Would your answer to parts (a) change (and if so how) if the fair market value of the land were $50 and Roses basis was $75?

g) Would the answer to part (c) change if instead of transferring land Rose transferred inventory?