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"Leah transfers equipment (basis of $400,000 and f...

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"Leah transfers equipment (basis of $400,000 and fair market value of $500,000) for additional stock in Crow Corporation. After the transfer, Leah owns 80% of Crow?s stock. Associated with the equipment is ? 1245 depreciation recapture potential of $70,000. As a result of the transfer: a. Leah recognizes ordinary income of $70,000. b. The ? 1245 depreciation recapture potential carries over to Crow Corporation. c. The ? 1245 depreciation recapture potential disappears. d. Leah recognizes ordinary income of $70,000 and ? 1231 gain of $30,000. e. None of the above.

 

Paper#6457 | Written in 18-Jul-2015

Price : $25
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