Seth, Pete, Cara, and Jen form SPCJ Corp. (a controlled corporation) by contributing the following consideration: • Seth contributes furniture & fixtures (FMV = $96,000; Seth's basis = $30,000) • Pete contributes equipment (FMV = $99,000; Pete's basis = $45,000) • Cara contributes land (FMV = $90,000; Cara's basis = $15,000) • Jen contributes cash (FMV = $30,000) In exchange, Seth, Pete, Cara, and Jen receive the following: • Seth receives 30 shares of SPCJ Corp. plus $6,000 cash. • Pete receives 30 shares of SPCJ Corp. plus $9,000 cash. • Cara receives 30 shares of SPCJ Corp. • Jen receives 10 shares of SPCJ Corp. Each share of SPCJ Corp. is worth $3,000. What is Seth's basis in his shares of SPCJ Corp.?

Seth, Pete, Cara, and Jen form SPCJ Corp. (a controlled corporation) by contributing the following consideration: • Seth contributes furniture & fixtures (FMV = $96,000; Seth's basis = $30,000) • Pete contributes equipment (FMV = $99,000; Pete's basis = $45,000) • Cara contributes land (FMV = $90,000; Cara's basis = $15,000) • Jen contributes cash (FMV = $30,000) In exchange, Seth, Pete, Cara, and Jen receive the following: • Seth receives 30 shares of SPCJ Corp. plus $6,000 cash. • Pete receives 30 shares of SPCJ Corp. plus $9,000 cash. • Cara receives 30 shares of SPCJ Corp. • Jen receives 10 shares of SPCJ Corp. Each share of SPCJ Corp. is worth $3,000. What is Seth's basis in his shares of SPCJ Corp.?

SWFT Essntl Tax Individ/Bus Entities 2020

23rd Edition

ISBN:9780357391266

Author:Nellen

Publisher:Nellen

Chapter12: Corporations: Organization, Capital Structure, And Operating Rules

Section: Chapter Questions

Problem 3BCRQ

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