During the year, Blue Corporation distributes land to its sole shareholder.If the fair market value of the land is less than its adjusted basis, Blue will recognize a loss on the distribution.

Question

Quizplus · Accepted Answer

If the fair market value of the distributed land is less than its adjusted basis, there is no loss recognized by the corporation on the distribution. The shareholder would instead reduce their basis in the distributed land.

During the Year, Blue Corporation Distributes Land to Its Sole