Owen and Claudette formed Persimmon Inc. on May 1. Owen cont…
Owen and Claudette formed Persimmon Inc. on May 1. Owen contributed cash of $500,000 in return for 50 percent of Persimmon’s stock. Claudette contributed a building and land in return for 50 percent of the stock. The building had a fair market value of $180,000 and an adjusted basis (to Claudette) of $150,000. The land had a fair market value of $420,000 and an adjusted basis (to Claudette) of $500,000. In addition to stock, Persimmon paid Claudette $100,000 in cash. How much gain (loss) must Claudette recognize?
Read DetailsGrace and Bill form a corporation with each shareholder rece…
Grace and Bill form a corporation with each shareholder receiving 50 percent of the stock. Bill transfers property and services, whereas Grace transfers property only. The fair market value of Grace’s contributed property is $70,000 and her adjusted basis is $0. What is the least (i.e., minimum) amount of property that Bill must contribute for Grace to defer recognition of her realized gain under § 351?
Read Details