A taxpayer who receives nonvoting preferred stock is not eligible for deferral in a §351 exchange.

Name: A taxpayer who receives nonvoting preferred stock is not eligible for deferral in a §351 exchange.
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In a §351 exchange, the receipt of nonvoting preferred stock can still qualify for deferral as long as the other requirements of §351 are met, such as control of the corporation immediately after the exchange.

A Taxpayer Who Receives Nonvoting Preferred Stock Is Not Eligible