A Taxpayer Who Receives Nonvoting Stock Is Not Eligible for Deferral

question 11

True/False

A taxpayer who receives nonvoting stock is not eligible for deferral in a §351 exchange.

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Definitions:

Individually Liable

A legal concept where an individual is personally responsible for fulfilling the obligations of a contract or debt.

Partnership Debts

Liabilities that are owed by a partnership, which are the joint responsibility of the partnership's members.

Mutual Agency

A legal principle in partnerships where each partner has the authority to act on behalf of, and bind, the partnership in contractual agreements.

Unlimited Liability

Partners may be personally liable for debts of the partnership.