Sybil Transfers Property with a Tax Basis of $5,000 and a Fair

question 54

Multiple Choice

Sybil transfers property with a tax basis of $5,000 and a fair market value of $6,000 to a corporation in exchange for stock with a fair market value of $3,000 and $2,000 cash in a transaction that qualifies as a section 351 transfer.The corporation assumed a liability of $1,000 on the property transferred.What is Sybil's tax basis in the stock received in the exchange?

• A)$6,000.
• B)$5,000.
• C)$4,000.
• D)$3,000.

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Definitions:

Posterior Intercostal

Refers to the blood vessels and nerves running along the bottom of the ribs at the back of the thorax, involved in supplying the intercostal spaces.

Common Iliac Artery

A large artery that divides into the internal and external iliac arteries, supplying blood to the pelvis and lower limbs.

Bifurcation

Bifurcation refers to the process or point at which a structure divides into two branches or parts, often used in reference to blood vessels or branching patterns in biology.

Abdominal Aorta

The largest artery in the abdominal cavity that delivers oxygen-rich blood to the abdominal organs, pelvis, and legs.