Which of the Following Statements Best Describes the "Built-In Loss

question 4

Multiple Choice

Which of the following statements best describes the "built-in loss" rules that apply to the basis of property transferred to a corporation under section 351?

• A)If the basis of a property transferred to a corporation under section 351 exceeds its fair market value, the corporation will always take a tax basis in the property equal to the property's fair market value.
• B)If the basis of a property transferred to a corporation under section 351 exceeds its fair market value, the corporation will always take a tax basis in the property equal to the property's tax basis in the hands of the shareholder.
• C)If the aggregate basis of all property transferred to a corporation under section 351 exceeds its aggregate fair market value, the aggregate tax basis of the property in the hands of the corporation cannot exceed the aggregate fair market value of the property.
• D)If the aggregate basis of all property transferred to a corporation under section 351 exceeds its aggregate fair market value, the aggregate tax basis of the property in the hands of the corporation cannot exceed the aggregate tax basis of the property.

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Definitions:

Intersexual Selection

A mode of natural selection where members of one biological sex choose mates of the other sex to mate with, often based on certain desirable characteristics.

Polyandry

A mating system in which a female mates with several males during a breeding season. Compare with polygyny.

Intrasexual Selection

A type of natural selection where members of one sex compete with each other for access to members of the opposite sex for reproduction.

Problem Solving

The process of finding solutions to difficult or complex issues through a systematic approach that involves creativity and reasoning.