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Hey guys. If anyone could help explain this it would be greatly appreciated.
Token contributes the following to a C Corp: $10,000 in cash; property worth $40,000 ($5,000 basis), with a related assumed recourse liability of $20,000.
It states that the C Corp’s basis in the property contributed is 10,000 (Basis of 5,000 + Boot recognized of 5,000). According to Becker, the C Corps basis is the greater of the asset contributed plus any gain recognized OR any liabilities assumed by the corporation. Wouldn’t the liabilities of 20,000 here be the basis since 20,000 is greater than 10,000?
BEC - 77AUD - 85
REG - TBD
FAR - Q2
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