In a corporate liquidation,the built-in loss limitation can apply to sales of property in addition to liquidating distributions of property.

Question

Quizplus · Accepted Answer

The built-in loss limitation applies not only to liquidating distributions of property, but also to sales of property in a corporate liquidation. This limitation prevents a corporation from claiming a loss on the sale or distribution of property that exceeds the property’s adjusted basis.

In a Corporate Liquidation,the Built-In Loss Limitation Can Apply to Sales