In an agreement involving the right to acquire property, which of the following are conditions that must be met in order for the IRS to accept the purchase price set in the agreement as a valid measurement of the value of the property being acquired?

SWFT Comprehensive Vol 2020
43rd Edition
ISBN:9780357391723
Author:Maloney
Publisher:Maloney
Chapter19: Corporations: Distributions Not In Complete Liquidation
Section: Chapter Questions
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In an agreement involving the right to acquire property, which of the following are conditions that must be met in order for the IRS to accept the purchase price set in the agreement as a valid measurement of the value of the property being acquired?

  1. The purchase price must be determined by an independent appraisal submitted with an informational gift tax return regardless of the value of the property.
  2. The agreement must be a bona fide business arrangement.
  3. The agreement cannot be an attempt to transfer the property to a family member for less than full and adequate consideration.
  4. The terms of the agreement must be comparable to those that would be entered into by persons in an arm's-length transaction
A)
I and III
 
 
B)
II and IV
 
 
C)
I and IV
 
 
D)
II, III, and IV
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