Frank, George, and Hannah form FGH Corporation. In exchange for 200 shares of stock of the corporation, Frank contributes property with a basis of $25,000, fair market value of $50,000 and subject to a liability of $25,000 which the corporation assumed. George contributes property with a basis of $30,000, fair market value of $50,000 in exchange for 150 shares of stock of the corporation with a value of $35,000 plus $15,000 cash. Hannah performs services for the corporation and receives $1,000 worth of stock (10 shares) in exchange for the services. a. What is the amount of Frank's recognized gain or loss on the transaction? b. What is Frank's basis in the stock of the corporation? c. What is the corporation's basis in the property received from Frank? d. What is the amount of George's recognized gain or loss on the transaction? e. What is George's basis in the stock of the corporation? f. What is Hannah’s basis in the stock of the corporation?
Frank, George, and Hannah form FGH Corporation. In exchange for 200 shares of stock of the corporation, Frank
contributes property with a basis of $25,000, fair market value of $50,000 and subject to a liability of $25,000 which the
corporation assumed. George contributes property with a basis of $30,000, fair market value of $50,000 in exchange for
150 shares of stock of the corporation with a value of $35,000 plus $15,000 cash. Hannah performs services for the
corporation and receives $1,000 worth of stock (10 shares) in exchange for the services.
a. What is the amount of Frank's recognized gain or loss on the transaction?
b. What is Frank's basis in the stock of the corporation?
c. What is the corporation's basis in the property received from Frank?
d. What is the amount of George's recognized gain or loss on the transaction?
e. What is George's basis in the stock of the corporation?
f. What is Hannah’s basis in the stock of the corporation?
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