Identify Which of the Following Statements Is True

question 41

Multiple Choice

Identify which of the following statements is true.

• A) When boot is received in a Sec. 355 spin- off transaction, the FMV of the boot will be a dividend to the extent of the shareholder's ratable share of the distributing corporation's E&P.
• B) A tax- free spin- off coming under Sec. 355 occurs when a parent corporation distributes stock in a controlled subsidiary corporation in exchange for some of its own stock.
• C) Tax- free split- offs and spin- offs coming under Sec. 355 require the surrender of shareholder stock.
• D) All of the above are false.

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Definitions:

Volcanic Ash

Fine particles of rock and volcanic glass created by explosive volcanic eruptions.

Nonvesicular Basalt

Basalt rock characterized by a solid and dense structure without vesicles, which are small cavities formed by gas bubbles.

Low Content

Refers to materials, information, or substances that are present in minimal amounts.

Ropy Texture

A geological texture characterized by smooth, undulating surfaces, commonly found in pahoehoe lava flows.