(These questions are related to U.S. Taxes. Also, it's highly related to corporate tax. I don't want the same person answering please!).

Instructions:

Your answers should be phrased in the form of a question. Do not answer the questions. A complete submission should include at least two questions in total.

Note that the questions you pose should be question that can only be answered by conducting tax research such as reviewing the tax code or case law. It should not be a question of fact that can be answered by asking the client or reviewing the transaction documents.

Identify Tax Issues

Information:

Identify at least two main tax issues suggested for the scenario described below:

Peter Jones has owned all 100 shares of Trenton Corporation stock for the past five years. This year, Mary Smith contributes property with a $50,000 basis and an $80,000 FMV for 80 newly issued Trenton shares. At the same time, Peter contributes $15,000 in cash for 15 newly issued Trenton shares. What tax issues regarding the exchanges should Mary and Peter consider?