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29 Sep 2019
F contributes cash of $7,500 and land worth $52,500 (basis of $16,500) to an entity for a 75% ownership interest in the entity, which was created three years ago by G who had contributed $15,000 cash back then. What is F's recognized gain or loss and what is F's basis in the ownership of this entity if the entity is (a) an S-corporation, (b) a partnership, and (c) a C-corporation?
F contributes cash of $7,500 and land worth $52,500 (basis of $16,500) to an entity for a 75% ownership interest in the entity, which was created three years ago by G who had contributed $15,000 cash back then. What is F's recognized gain or loss and what is F's basis in the ownership of this entity if the entity is (a) an S-corporation, (b) a partnership, and (c) a C-corporation?
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Deanna HettingerLv2
29 Sep 2019
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Problem 18-15 (a) (LO. 4)
Quentin, Tara and Tito form a business entity with each contributing the following.
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Their ownership percentages will be as follows.
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Taraâs land has a $30,000 mortgage that is assumed by the entity. Tito is an attorney who receives her ownership interest in exchange for legal services. Determine the recognized gain to the owners, the basis for their ownership interests, and the entityâs basis for its assets if the entity is organized as:
If an amount is zero, enter "0".
a. Entity: Partnership.
Recognized Gain | Partners' Basis | |
Quentin | $ | $ |
Tara | $ | $ |
Tito | $ | $ |
Asset | Partnership's Basis |
Cash | $ |
Land | $ |
Organizational Costs | $ |
b. Entity: C corporation.
|
Asset | C Corporation's Basis |
Cash | $ |
Land | $ |
Organizational Costs | $ |
c. Entity: S corporation.
S corporation | ||
Recognized Gain | Shareholders' Basis | |
Quentin | $ | $ |
Tara | $ | $ |
Tito | $ | $ |
Asset | S Corporation's Basis |
Cash | $ |
Land | $ |
Organizational Costs | $ |