Six years ago, Mr. Magarian contributed an office building to Magarian Rugs, a C corporation, in exchange for 25 percent equity interest in the business. Since the contribution, the company uses the building to house their inventory and offices. After this contribution, Mr. Magarian has 85% interest in the corporation. His tax basis in the office building was $500,000 and the buildings appraised FMV on date of contribution to the business was $675,000. This year, Magarian Rugs sold the building to an unrelated purchaser for $800,000. He paid a realtor a 5 percent commission. Mr. Magarian is planning on retiring soon and will eventually sell the business. 2. Based on the factors above, did Mr. Magarian recognize a gain on the contribution of the office building to the corporation? Use IRC Section 351 in your analysis to explain your answer. (15 points)