Dan Transfers Property with an Adjusted Basis of $50,000 and an FMV

question 46

Essay

Dan transfers property with an adjusted basis of $50,000 and an FMV of $100,000 to a newly formed Sun Corporation in exchange for 500 shares of Sun stock, which is one-half of the outstanding Sun stock. His daughter, Sylvia, transfers property with an adjusted basis of $25,000 and an FMV of $50,000 for the other 500 shares at the same time. What are the tax consequences of the two transfers, assuming all the requirements of Sec. 351 are met?

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Definitions:

Largest City

The city that has the highest population or covers the largest area within a given country or region.

San Francisco

A cultural, commercial, and financial center in northern California, USA, known for its historic landmarks, tech industry, and diverse culture.

Los Angeles

A major city in the state of California, USA, known for its significant cultural, economic, and entertainment influence.

American West

A region of the United States generally considered to encompass the westernmost states, associated with frontier history, expansion, and cultural distinctiveness.