Kim, a real estate dealer, and others form Eagle Corporation under § 351. Kim contributes inventory (land held for resale) in return for Eagle stock. The holding period for the stock includes the holding period of the inventory.

Question

Quizplus · Accepted Answer

Under § 351, the holding period for the stock received does not include the holding period of the inventory (land held for resale) contributed to the corporation. The holding period for the stock begins when the stock is acquired, not from when the inventory was originally held by the contributor.

Kim, a Real Estate Dealer, and Others Form Eagle Corporation