During 2017, Track Corporation Distributes Property to Cindy as Part

question 64

Multiple Choice

During 2017, Track Corporation distributes property to Cindy as part of a complete liquidation. Property included in the distribution is $30,000 in cash, land with a $40,000 adjusted basis and a $60,000 FMV, and a copyright without an ascertainable FMV and having a zero basis. The first payment to Cindy of $8,000 for use of the copyrighted property occurs in 2018. Cindy has a basis in the Track stock of $95,000 immediately preceding the liquidation. The minimum amount of gain that Cindy must recognize is a

• A)$3,000 gain in 2018.
• B)$0 gain in 2017.
• C)$3,000 gain in 2017, which is reported on an amended current-year tax return that is filed in 2018.
• D)none of the above

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Definitions:

Recently Published Regulations

Newly issued rules or directives established by a governmental authority intended to guide or govern conduct within its jurisdiction.

IRAC Method

A framework for legal analysis that stands for Issue, Rule, Application, and Conclusion; used to break down legal cases or hypotheticals into manageable segments.

Briefing a Case

The process of summarizing a court case, identifying the main points, legal issues, arguments, and decisions to understand and remember its significance.

Holding

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