Determine the effects of 5 351 for the following taxpayers. If an amount is zero, enter "0". a. Grady exchanges qualified property, basis of $12,000 and fair market value of $18,000, for 60% of the stock of Eadie Corporation. The other 40% of the stock is owned by Pedro, who acquired it five years ago. the control of the corporation requirement, Grady has income of s Because this transaction does not meet 18,000 basis in his shares of stock. b. Trey, Amy, and Erin incorporate their businesses by forming Whitehead Corporation. As part of a prearranged plan, Trey exchanges his qualified property (basis $500; fair market value $1,000) for 100 shares in Whitehead on May 9, 2021. Amy exchanges her qualified property (basis $1,800; fair market value $2,000) for 200 shares of Whitehead Corporation stock on May 12, 2021, and Erin exchanges her qualified property (basis $2,000; fair market value $3,000) for 300 shares in Green on March 5, 2021. the control of the corporation requirement, Trey has income of $ basis in his shares of stock, Amy has income of s and S and basis in her shares of stock. Because this transaction 6,000 and Erin has income of s and basis in her shares of stock, and i
Determine the effects of 5 351 for the following taxpayers. If an amount is zero, enter "0". a. Grady exchanges qualified property, basis of $12,000 and fair market value of $18,000, for 60% of the stock of Eadie Corporation. The other 40% of the stock is owned by Pedro, who acquired it five years ago. the control of the corporation requirement, Grady has income of s Because this transaction does not meet 18,000 basis in his shares of stock. b. Trey, Amy, and Erin incorporate their businesses by forming Whitehead Corporation. As part of a prearranged plan, Trey exchanges his qualified property (basis $500; fair market value $1,000) for 100 shares in Whitehead on May 9, 2021. Amy exchanges her qualified property (basis $1,800; fair market value $2,000) for 200 shares of Whitehead Corporation stock on May 12, 2021, and Erin exchanges her qualified property (basis $2,000; fair market value $3,000) for 300 shares in Green on March 5, 2021. the control of the corporation requirement, Trey has income of $ basis in his shares of stock, Amy has income of s and S and basis in her shares of stock. Because this transaction 6,000 and Erin has income of s and basis in her shares of stock, and i
Chapter14: Choice Of Business Entity—operations And Distributions
Section: Chapter Questions
Problem 54P
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Transcribed Image Text:Determine the effects of § 351 for the following taxpayers.
If an amount is zero, enter "0".
a. Grady exchanges qualified property, basis of $12,000 and fair market value of $18,000, for 60% of the stock of Eadie Corporation. The
other 40% of the stock is owned by Pedro, who acquired it five years ago.
the control of the corporation requirement, Grady has income of $
Because this transaction does not meet
18,000 basis in his shares of stock.
b. Trey, Amy, and Erin incorporate their businesses by forming Whitehead Corporation. As part of a prearranged plan, Trey exchanges his
qualified property (basis $500; fair market value $1,000) for 100 shares in Whitehead on May 9, 2021. Amy exchanges her qualified
property (basis $1,800; fair market value $2,000) for 200 shares of Whitehead Corporation stock on May 12, 2021, and Erin exchanges her
qualified property (basis $2,000; fair market value $3,000) for 300 shares in Green on March 5, 2021.
the control of the corporation requirement, Trey has income of $
and $
basis in her shares of stock.
Because this transaction
basis in his shares of stock, Amy has income of $
and
6,000 and
Erin has income of $
and
basis in her shares of stock, and
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