Taxpayer C forms C Corporation. Taxpayer C transfers a piece of land with a fair market value $($FMV$)$ of $$400,000--$and an adjusted basis $($AB$)$ of $$230,000-$ for $100\%$ of the Common Stock of C Corporation. The taxpayer has $2$ loans secured by the land: Mortgage Loan #$1$ for $$200,000($a business loan taken out for a valid business purpose$)$; and Mortgage Loan #$2$ for $12,000($a short$-$term loan with the land pledged as collateral and used by Taxpayer $C$ to pay off his personal gambling losses to his bookie.$)$