The City of Portland gives Data Corporation $60,000 cash and land worth $100,000 to induce it to move. The cash was not spent during the 12 months following contribution. The contribution results in A. income recognition in the amount of $160,000 to the corporation at the time of contribution. B. a zero basis in the land and a $60,000 basis reduction in other assets. C. income recognition in the amount of $60,000 to the corporation 12 months after the time of contribution. D. a zero basis in the land and $60,000 ordinary income to the corporation 24 months after the time of contribution if the cash is not used to purchase an asset.

The City of Portland gives Data Corporation $60,000 cash and land worth $100,000 to induce it to move. The cash was not spent during the 12 months following contribution. The contribution results in A. income recognition in the amount of $160,000 to the corporation at the time of contribution. B. a zero basis in the land and a $60,000 basis reduction in other assets. C. income recognition in the amount of $60,000 to the corporation 12 months after the time of contribution. D. a zero basis in the land and $60,000 ordinary income to the corporation 24 months after the time of contribution if the cash is not used to purchase an asset.

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter5: Introduction To Business Expenses

Section: Chapter Questions

Problem 39P

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