Henry Transfers Property with an Adjusted Basis of $95,000 and an FMV

question 113

Multiple Choice

Henry transfers property with an adjusted basis of $95,000 and an FMV of $100,000 to a newly formed corporation in a Sec. 351 exchange. Henry receives stock with an FMV of $85,000 and a short-term note with a $15,000 FMV. Henry's basis in the stock is

• A)$100,000.
• B)$95,000.
• C)$90,000.
• D)$85,000.

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Definitions:

Personal Fable

A cognitive distortion experienced by adolescents, leading them to believe they are unique and invincible.

Traffic Rules

Regulations established by authorities to ensure safe and efficient movement of vehicles and pedestrians on roads.

Sport-Utility Vehicle

A class of vehicle that combines elements of road-going passenger cars with features from off-road vehicles, like increased ground clearance and four-wheel drive.

Personal Fable

A cognitive distortion encountered in adolescence, making individuals believe they are unique, invincible, and not understood by others.