Dennis contributed business assets to a new business in exchange for stock in the company. The exchange did not qualify as a tax- deferred exchange. The fair market value of these assets was $367,000 on the contribution date. Dennis's original basis in the assets he contributed was $216,000, and the accumulated depreciation on the assets was $122,250. Required a. What is the business's basis in the assets it received from Dennis? b. What would be the business's basis if the transaction qualified as a tax-deferred exchange? a. Business's basis b. Business's basis

Which of the following is true with respect to the related party rules? a.A disallowed loss on a related party transaction can be used to offset any future gain when the property is sold to an unrelated party. b.Bill sells stock to his sister for a $3,000 loss. Bill can deduct the loss on his tax return. c.A taxpayer's uncle is a related party for purposes of Section 267. d.Under the constructive ownership rules of Section 267, a shareholder owns 10 percent of the stock owned by a corporation in which he or she is a shareholder. e.None of these choices are correct.

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Casey transfers property with a tax basis of $2,840 and a fair market value of $6,600 to a corporation in exchange for stock with a fair market value of $4,800 and $450 in cash in a transaction that qualifies for deferral under section 351. The corporation assumed a liability of $1,350 on the property transferred. Casey also incurred selling expenses of $372. What is the amount realized by Casey in the exchange? Multiple Choice $6,600 $6,228 $6,128 $5,678

LiO Company transferred an old asset with a $13,600 adjusted tax basis in exchange for a new asset worth $11,000 and $1,500 cash. Which of the following statements are true? a) If the exchange is taxable, LiO recognizes an $1,100 loss. b) If the exchange is nontaxable, LiO recognizes no loss. c) If the exchange is nontaxable, LiO’s tax basis in the new asset is $12,100 d) If the exchange is nontaxable, LiO recognizes a $1,500 Loss

George operates a business that generated revenues of $61 million and allocable taxable income of $1.36 million. Included in the computation of allocable taxable income were deductible expenses of $245,500 of business interest and $255,500 of depreciation. What is the business interest limitation that George will be subject to this year if the business does not qualify under the gross income test?

If a taxpayer chooses to have his dividends automatically reinvested in the corporation's stock, they are not reported on the tax return nor taxed because he did not receive the money. Choose one a. True answer. b. False Which of the following items is generally not taxable on a Federal return? Choose one a. Income from illegal activity answer. b. Inheritance c. Fees received for jury duty d. Tips under $20 a month e. None of these

Select the best answer. Which of the following statements regarding transfers of property or services is true? For a transfer of property to a corporation, no gain is recognized by the taxpayer if the O A. transferred property is encumbered with liabilities in excess of the taxpayer's basis in the property. O O O If receipt of stock is subject to a substantial risk of forfeiture, income is recognized by th B. recipient in the year the stock is received even though the substantial risk of forfeiture h lapsed. If the contributing partner receives a capital interest in the partnership upon contributi C. services, the contributor will be taxed on the transfer when the contributor actually rec profits. In order for an exchange of services to a partnership for a profit interest to qualify as a D. nontaxable event, the service partner must provide services to the partnership or for it benefit, and the services must be provided by the service partner in his capacity as a p Submit Answers

Which of the following statements regarding losses is true? A. A personal net operating loss may be carried back but not forward to other tax years. B. A sole proprietor may deduct business losses against any form of income. C. In a regular corporation, entity level losses are passed through to the shareholders. D. In a S corporation, entity level losses are fully deductible by the shareholder under any circumstance.