Acquiring Corporation Is 100%-Owned by Peter Hart

question 70

Multiple Choice

Acquiring Corporation is 100%-owned by Peter Hart. Target Corporation is 100% owned by Dick Weber. The two individuals are not related. Target Corporation has $400,000 of NOL carryovers at the time Acquiring Corporation is considering making a cash acquisition of part or all of Target Corporation's stock. What is the maximum amount of Target stock that can be acquired in a single transaction without the Sec. 382 loss limitation rules applying to the NOLs?

• A)49%
• B)50%
• C)80%
• D)Any acquisition of Target stock will cause the Sec. 382 loss limitation to apply.

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Definitions:

Memory Construction

The process by which the brain actively organizes and shapes information during encoding, storage, and retrieval of memories.

Chemical Transfer

The movement of chemicals or substances between environments, often referring to the process by which drugs move through the body or how pollutants spread in ecosystems.

Biases and Assumptions

Prejudices or preconceived beliefs that affect how information is perceived, interpreted, and acted upon.

Source Amnesia

A memory disorder whereby someone can recall certain information but cannot remember how, when, or where they learned that information.