Your client, Edward Bolleni, CPA has recently left his Big Four position and is "out on his own". After preparing tax returns for the 2016 tax year, Mr. Bolleni has decided to operate his own accounting firm. Mr. Bolleni wants limited liability protection in his operations as an accountant, as well as, liability protection from any accidents or slip and falls that would occur in his accounting office. Mr. Bolleni has an accounts receivable worth $50,000 for tax preparation fees for the 2016 tax year, as well as, an interest in a real estate partnership that is used as collateral for a loan that Mr. Bolleni received from Bank of America so that he could have additional capital for his new business.The fair market value of the real estate partnership interest is $500,000 and the loan is for $200,000. Mr. Bolleni comes to your office and asks you the following questions:

A.If the taxpayer does contribute the assets to the corporation, the taxpayer wants to know what tax impact if any, would happen if he immediately transferred 50% of the shares in the corporation to his wife as a gift.