Roger Transfers Assets from His Sole Proprietorship to His 100%-Owned

question 39

Multiple Choice

Roger transfers assets from his sole proprietorship to his 100%-owned Motor Corporation. Immediately after the incorporation, Motor Corporation transfers all of its assets to Blue Corporation for 10% of Blue's stock. Motor Corporation is liquidated. Which of the following statements is correct?

• A)The asset transfer by Motor Corporation meets the statutory Type C reorganization requirements.
• B)The IRS may collapse the two transactions into a single transaction, resulting in denial of tax-free reorganization treatment.
• C)The IRS may apply the step transaction doctrine.
• D)All of the above statements are correct.

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