[Anonymous]

if a shareholder gets, let’s say, a building with basis of $10k, mortgage of $5k, and FMV of $40k, what will be the realized, and recognized gain for both the Shareholder and the C Corp.

My understanding is that

for SH:

Realized and Recognized Gain = FMV – Debt – basis = $40k-5k-10k = $25k

Basis in property = FMV = $40k

For Corp

Realized and recognized Gain = FMV – Debt – Basis $25k, add to E&P

am i correct? exam day tomorrow but still confused…

Thanks for any clarifications!

[Anonymous]

Find count i might be wrong

SH realized/recognized gain = FMV – Debt – Basis

Corp realized/recognized gain should = Greater of debt assumed by SH and FMV – Basis

and Corp recognize capital gain if Basis > Debt assumed by SH

Still confused about SH basis

Should it be FMV only or FMV + Debt assumed?

[Author]

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