[thorsbew]

I’m in a bind… I’m trying to figure out how much basis a transferor for shares of a corporation receives. I’ve got Wiley’s MC questions telling me that their basis is carried over to the shares of stock, and CPAreview.com is telling me that their FV at time of transfer is their new basis in the stock.

I would understand if someone controlled the corporation that their basis is just transferred, but the MC infers something else! Can someone please help? Exam tomorrow!!!! 🙁

Aud - 65 + 79, BEC - 82, REG - 89, FAR - 86

[Anonymous]

I thought cont to a C Corp with at least 80% ownership in stock afterwards (or forming a C Corp with contrbuted assets), you use the basis of the asset to the contributing shareholder, unless the liability exceeds the basis, which will then result in taxable boot to the shareholder (liab assumed over basis) and the C Corp will record the asset at the greater of the basis or the liability assumed. FMV is used when services are contributed or when less than 80% control is acquired after contribution, correct?

[Anonymous]

So, the difference between an 80% owned C-Corp and a less than 80% owned one is that you recognize a gain as a shareholder if you transfer appreciated property on the less than 80% owned? Pg 709 of the most recent Wiley book is very confusing.

I am really trying to figure out how an 80% corporation differs from a less than 80% when it comes to gains to the shareholder for appreciated property.

[Anonymous]

So, the difference between an 80% owned C-Corp and a less than 80% owned one is that you recognize a gain as a shareholder if you transfer appreciated property on the less than 80% owned? Pg 709 of the most recent Wiley book is very confusing.

I am really trying to figure out how an 80% corporation differs from a less than 80% when it comes to gains to the shareholder for appreciated property.

[Author]

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