Aaron Purchases a Building for $500,000 Which Is Going to Be

question 116

Multiple Choice

Aaron purchases a building for $500,000 which is going to be used by his wholly-owned corporation.Which of the following statements are correct?

• A)If Aaron contributes the building to the corporation,there will be no recognition under § 351 and a carryover basis of $500,000.
• B)If Aaron leases the building to the corporation,lease-rental payments of $30,000 per year to Aaron will result in a $30,000 deduction for the corporation.
• C)If Aaron leases the building to the corporation,lease-rental payments of $30,000 per year to Aaron will result in $30,000 of gross income for Aaron.
• D)Leasing the building to the corporation will contribute to the tax avoidance objective of minimizing double taxation.
• E)All of the above are correct.

---

Definitions:

Similar Personalities

The degree to which individuals share the same traits, characteristics, and modes of behavior.

Role Confusion

The uncertainty felt by individuals who are unsure about their identity or future roles in society, often discussed in Erikson's stages of psychosocial development.

Weakening Immune System

A decrease in the effectiveness of the immune system, which reduces the body's ability to fight off infections and diseases.

Susceptible To Pneumonia

Having an increased vulnerability or tendency to develop pneumonia, an infectious disease affecting the lungs.