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Dafna1 [17]
3 years ago
5

Antoine transfers property with a tax basis of $524 and a fair market value of $647 to a corporation in exchange for stock with

a fair market value of $569 in a transaction that qualifies for deferral under section 351. The corporation assumed a liability of $78 on the property transferred. What is Antoine's tax basis in the stock received in the exchange
Business
1 answer:
podryga [215]3 years ago
3 0

Answer: $446

Explanation:

Antoine will receive the same basis in the stock that was in the property.

The Corporation however, assumed $78 of the liability of the property transferred which would reduce Antoine's basis in that property

Antoine's basis = Property base - Liability assumed by corporation

= 524 - 78

= $446

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