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Chapter 15, problems 4, 6, 14 and 16.
4.Explain the 80% rule as it pertains to the formation of a corporation.
6.An individual contributes property with a fair market value in excess
of basis to a corporation in exchange for stock. What is the basis of the
stock in the hands of the shareholder, and what is the basis of the
property contributed in the hands of the corporation?
14.A corporation may make a distribution to its shareholders.
Depending on the circumstances, in the hands of the shareholder, the
distribution can be classified as a dividend, a tax-free distribution, or a
capital gain. Explain the circumstances in which each classification
can occur.