Questions from Federal Taxation

Q: Alice, Beth, and Carl formed the ABC Partnership early in

Alice, Beth, and Carl formed the ABC Partnership early in Year 1. Alice and Beth each contributed $100,000 for their partnership interests, and Carl contributed land having a $100,000 FMV and $160,000...

Q: The following advertisement appeared in a financial journal: $17

The following advertisement appeared in a financial journal: $17 MILLION CASH WITH ADDITIONAL CASH AVAILABLE $105 MM TAX LOSS GOOD THROUGH 2031 CAPITAL GROUP, INC. NASDAQ listed w/300 shareholders WAN...

Q: Sarah and Rex formed SR Entity on December 28 of last year

Sarah and Rex formed SR Entity on December 28 of last year. The entity operates on a calendar tax year. Each individual contributed $800,000 cash in exchange for a 50% ownership interest in the entity...

Q: What entities or business forms are available for a new enterprise?

What entities or business forms are available for a new enterprise? Explain the advantages and disadvantages of each.

Q: Six years ago, Donna purchased land as an investment. The

Six years ago, Donna purchased land as an investment. The land cost $150,000 and is now worth $480,000. Donna plans to transfer the land to Development Corporation, which will subdivide it and sell in...

Q: On March 1 of the current year, Alice, Bob,

On March 1 of the current year, Alice, Bob, Carla, and Dick form Bear Corporation and transfer the following items: Alice purchased the land and building several years ago for $12,000 and $50,000, res...

Q: Ed and Fay together own 100% of the common stock of

Ed and Fay together own 100% of the common stock of an existing corporation. On January 2 of the current year, they made the following additional transfers to the corporation, which qualify under Sec....

Q: Assume the same facts as in Problem C:2-55

Assume the same facts as in Problem C:2-55. a. Under what circumstances is the tax result in Problem C:2-55 beneficial, and for which shareholders? Are the shareholders likely to be pleased with the...

Q: Paula Green owns and operates the Green Thumb Nursery as a sole

Paula Green owns and operates the Green Thumb Nursery as a sole proprietorship. The business has total assets with a $260,000 adjusted basis and a $500,000 FMV. Paula wants to expand into the landscap...

Q: Assume the same facts as in Problem C:2-57

Assume the same facts as in Problem C:2-57. a. Given the nursery’s operating prospects, what business forms might Paula and Mary consider and why? b. In light of their proposed use of debt and equit...