Reference no: EM132227

Question :

In each of the given scenarios, evaluate in regards to the exchange with X:

a) A's amount realized
b) A's loss or gain realized
c) A's loss or gain recognized and the character thereof
d) A's basis in the X stock received
e) A's holding period for the X stock received (tacked or not?)
f) X's basis in the property received
g) X's holding period for the property received (tacked or not?)
h) The amount and character of X's gain if X immediately sells the property for $100

And the given in regards to the subsequent sale from A to B:

i) A's loss or gain realized
j) A's gain or loss recognized and the character thereof
k) A's basis in the remaining shares
l) B's basis in the purchased shares from A

Assumptions: Except as otherwise stated, A starts out with non-depreciable real property (a capital asset) worth $100 (adjusted basis $40) and ends up with cash of $50 plus a 50% interest (worth $50) in X, a newly organized corporation that gets the property.

(a) A transfers the property to X in exchange for all of X's stock. Shortly thereafter, A sells half of his X stock to B for $50. The stock sale is a "separate" event from the prior incorporation transaction.

(b) Same as (a), except the stock sale is an integral part of the incorporation plan.