Which of the statements is inaccurate regarding requirements for nonrecognition of gain or loss upon the transfer of assets to a corporation in exchange for stock?
A)Depreciation recapture applies to a transfer which falls under Sec.351.
B)Property must be transferred to the corporation solely in exchange for stock of the corporation.
C)The transferor-shareholders must be in control (80%)of the corporation immediately after the exchange.
D)If property or money is received by the transferor,gain (but not loss)is recognized to the extent of the lesser of the boot received or the realized gain.

Question

Quizplus · Accepted Answer

This statement is inaccurate because depreciation recapture only applies to transfers of property that have been subject to depreciation or amortization. It is not specific to transfers under section 351 of the tax code. The other statements are accurate requirements for nonrecognition of gain or loss upon the transfer of assets to a corporation in exchange for stock.

Which of the Statements Is Inaccurate Regarding Requirements for Nonrecognition