Matt and Sheila Form Krupp Corporation

question 15

Multiple Choice

Matt and Sheila form Krupp Corporation. Matt contributes property with an FMV of $55,000 and a basis of $35,000. Sheila contributes property with an FMV of $75,000 and a basis of $40,000. Matt sells his stock to Paul shortly after the exchange. The transaction will

• A)not qualify under Sec. 351.
• B)qualify under Sec. 351 if Matt can show that the sale to Paul was not part of a prearranged plan.
• C)qualify with respect to Sheila under Sec. 351 whether Matt qualifies or not.
• D)qualify under Sec. 351 only if an advance ruling has been obtained.

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Definitions:

Authoritarian-aggressive

A behavior pattern characterized by a tendency to obey strict rules or authority figures with an inclination towards aggressive reactions against perceived threats or disobedience.

Sociable-intimate

The desire or tendency of an individual to engage in close and friendly relationships.

Dependent-dominant

A term that doesn't correspond to a well-defined concept in the provided context, potentially relating to dynamics within relationships or systems where one entity is dependent yet holds sway or influence over others.

New England Orchard Town

A town located in the New England region of the United States known for its cultivation and production of orchard fruits, such as apples and pears.