Transfer of property by sole shareholder to corporation

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Reference no: EM131916413

1. Rex & Marsha each own 50% of the Grandiflora Corporation, an S corporation with a calendar tax year. At the beginning of the tax year, Marsha & Rex both have a basis in the stock of the corporation of $25,000. On June 30, 2016, Rex sells his interest in the corporation to George for $200,000, & for 2016 the Grandiflora Corporation has a loss of $90,000. The amount of the corporation's loss that may be deducted by Rex on his 2016 tax return is $22,192.

True

False

2. Rex & Marsha each own 50% of the Grandiflora Corporation, an S corporation with a calendar tax year. At the beginning of the tax year, Marsha & Rex both have a basis in the stock of the corporation of $25,000. On June 30, 2016, Rex sells his interest in the corporation to George for $200,000, & for 2016 the Grandiflora Corporation has a loss of $90,000. The amount of the corporation's loss that may be deducted by George on his 2016 tax return is $22,808.

True

False

3. As a general rule, the transfer of property by a sole shareholder to a corporation in exchange solely for stock does not result in a taxable transaction.

True

False

Reference no: EM131916413

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