When Gain Is Realized by a Target Corporation from Disposing

question 19

Multiple Choice

When gain is realized by a target corporation from disposing of its assets in a tax-free reorganization, the gain is

• A)recognized if boot is received and immediately distributed to its shareholders.
• B)recognized without exception.
• C)recognized if boot is received and retained.
• D)never recognized.

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Definitions:

Savings Account Trust

A trust account set up at a bank or financial institution, where money is held under a trust agreement for the benefit of the beneficiaries.

Intestacy Statutes

Laws that govern the distribution of a person's estate if they die without a valid will, determining how their assets are divided among surviving relatives.

Legally Adopted

Refers to the formal process by which an adult becomes the legal parent of someone who is not their biological child.

Probated

The legal process of proving and registering the last will of a deceased person in court.