Webster, who owns all the Bear Corporation stock, purchases a dump truck from Bear Corporation in January. The truck cost $12,000 and has a $10,000 adjusted basis at the time of the sale. Webster pays Bear the truck's $8,000 FMV. Later in the same year, Webster sells the dump truck to an unrelated party for $6,000. Webster can recognize a loss of

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Webster's basis in the truck is $8,000 (the amount he paid Bear Corporation). When he sells it for $6,000, he realizes a loss of $2,000 ($8,000 - $6,000).

Webster, Who Owns All the Bear Corporation Stock, Purchases a Dump