Tax Drill Section 357(b) Ester transfers land (basis of $200,000 and fair market value of $355,000) to a controlled corporation in return for stock in the corporation. However, shortly before the transfer, Ester mortgages the land and uses the $25,000 proceeds to meet personal obligations. Along with the land, the mortgage is transferred to the corporation. Ester has a realized gain on the transfer of S and a recognized gain of $
Tax Drill Section 357(b) Ester transfers land (basis of $200,000 and fair market value of $355,000) to a controlled corporation in return for stock in the corporation. However, shortly before the transfer, Ester mortgages the land and uses the $25,000 proceeds to meet personal obligations. Along with the land, the mortgage is transferred to the corporation. Ester has a realized gain on the transfer of S and a recognized gain of $
Chapter11: The Corporate Income Tax
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Problem 16MCQ
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Transcribed Image Text:Tax Drill Section 357(b)
Ester transfers land (basis of $200,000 and fair market value of $355,000) to a controlled corporation in return for stock in the corporation.
However, shortly before the transfer, Ester mortgages the land and uses the $25,000 proceeds to meet personal obligations. Along with the
land, the mortgage is transferred to the corporation.
Ester has a realized gain on the transfer of S
and a recognized gain of $
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