Match Each of the Following Items with the Appropriate Description

question 146

Multiple Choice

Match each of the following items with the appropriate description, indicating whether the item increases or decreases the parent's basis in the stock of a subsidiary.
-Member's operating loss.

• A)Increases stock basis of subsidiary
• B)Decreases stock basis of subsidiary
• C)No effect on stock basis of subsidiary

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Definitions:

Express Trusts

A type of trust explicitly created by a settlor, typically in writing, specifying the trust's terms, beneficiaries, and the trustee's duties.

Trust Instruments

Legal documents establishing a trust, specifying its terms, and the responsibilities of the trustees.

Personal Representative

The person designated by a testator to collect the testator’s property after he or she dies, pay the debts and taxes, and make sure the remainder of the estate gets distributed.

Beneficiaries

Individuals or entities designated to receive benefits or assets from a will, trust, insurance policy, or other legal instrument.