In General, the Basis of Property to a Corporation in a Transfer

question 42

True/False

In general, the basis of property to a corporation in a transfer that qualifies as a nontaxable exchange under § 351 is the basis in the hands of the transferor shareholder decreased by the amount of any gain recognized on the transfer.

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Definitions:

Cleavage

1. The tendency of minerals to break along specific orientations of closely spaced planes. 2. The tendency of a rock, especially a metamorphic rock, to split along mostly parallel planes.

Luster

The reflection of light from the surface of a mineral, especially its quality and intensity; the appearance of a mineral in reflected light.

Color

A property of light as seen by people, typically defined by its wavelength or frequency.

Crystals

Solid materials whose constituents, such as atoms, molecules, or ions, are arranged in a highly ordered microscopic structure.