Roberta transfers property with a tax basis of $435 and a fair market value of $559 to a corporation in exchange for stock with a fair market value of $372 in a transaction that qualifies for deferral under section 351. The corporation assumed a liability of $187 on the property transferred. What is the amount realized by Roberta in the exchange?

Question

Quizplus · Accepted Answer

The amount realized by Roberta in the exchange is the fair market value of the stock received ($372) plus the liability assumed by the corporation ($187), totaling $559. This calculation is based on the principle that the amount realized from a transaction includes both the value of what is received and the amount of any liability from which the transferor is relieved.

Roberta Transfers Property with a Tax Basis of $435 and a Fair