A shareholder's holding period for stock received under § 351 includes the holding period of the property transferred to the corporation.

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Under § 1223(1) of the Internal Revenue Code, a shareholder’s holding period for stock received in a § 351 transaction includes the holding period of the property transferred to the corporation. Therefore, if the property transferred had a long-term holding period, the shareholder's holding period for the stock will also be long-term.

A Shareholder's Holding Period for Stock Received Under § 351