assignment 4

Corporate Formations Problem Mary and Todd form the MT Corporation, with a transfer of the following properties: Mary $1,200,000 cash Todd $1,200,000 FMV property $800,000 tax basis Mary will receive 50% and Todd 50% of the corporate stock. Complete the following Mary Todd Realized gain Recognized gain Basis of Stock MT basis in contributed asset VARIATION 1: return to original facts (same basis). Todd's property is valued at $1,600,000 but is contributed subject to a $400,000 liability Complete the following Mary Todd Realized gain Recognized gain Basis of stock MT basis in contributed asset VARIATION 2: Same as Variation 1 (same basis) except Todd's property is valued at 2,100,000 and is contributed subject to a liability of $900,000. Complete the following Mary Todd Realized gain Recognized gain Basis of stock MT basis in contributed asset