230k views
4 votes
Rachel owns 100% of the stock of Cardinal Corporation. In the current year Rachel transfers an installment obligation, tax basis of $180,000 and fair market value of $350,000, for additional stock in Cardinal worth $350,000.

a. Rachel has a taxable gain of $180,000.
b. Rachel recognizes no gain on the transfer.
c. Rachel has a taxable gain of $170,000.
d. Rachel has a basis of $350,000 in the additional stock she received in Cardinal Corporation.

User LukLed
by
7.7k points

1 Answer

3 votes

Answer:

b. Rachel recognizes no gain on the transfer.

Step-by-step explanation:

User Espen Schulstad
by
7.9k points

No related questions found