J is a 60 percent shareholder in the JS Corporation.In 2009, he sold property to the corporation for $60,000 (basis in his hands of $70,000).In 2012, the corporation sold the property for $65,000 to an unrelated party.The amount of gain or loss the JS Corporation must recognize in 2012 is

Question

Quizplus · Accepted Answer

The corporation recognizes no gain or loss on the sale because the property was sold to an unrelated party for less than J's original basis, and the loss was disallowed when J sold it to the corporation.

J Is a 60 Percent Shareholder in the JS Corporation