Jim, Betty, and Bill form Crow Corporation.Both Jim and Betty contribute cash of $500,000, and Bill contributes land (basis of $550,000; fair market value of $600,000) .Each shareholder receives one-third of Crow's stock, and Bill also receives $100,000 in cash.Which, if any, of the following choices is a correct result of the incorporation?
A) Bill's basis in the Crow stock is $650,000.
B) Crow's basis in the land is $550,000.
C) Crow's basis in the land is $650,000.
D) Crow's basis in the land is $600,000.
Correct Answer:
Verified
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