Eileen Transfers Property Worth $200,000 (Basis of $190,000) to Goldfinch

question 64

Multiple Choice

Eileen transfers property worth $200,000 (basis of $190,000) to Goldfinch Corporation. In return, she receives 80% of the stock in Goldfinch Corporation (fair market value of $180,000) and a long-term note (fair market value of $20,000) executed by Goldfinch and made payable to Eileen. Eileen recognizes gain on the transfer of:

• A) $0.
• B) $10,000.
• C) $20,000.
• D) $190,000.
• E) None of the above.

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Definitions:

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