Albert transfers land (basis of $140,000 and fair market value of $320,000) to G
ID: 2421109 • Letter: A
Question
Albert transfers land (basis of $140,000 and fair market value of $320,000) to Gold Corporation for 80% of its stock and a note payable in the amount of $80,000. Gold assumes Albert's mortgage on the land of $200,000. As a result of the transfer,
1. Albert has a recognized gain on the transfer of $140,000.
2. Albert has a recognized gain on the transfer of $80,000.
3. Albert has a recognized gain on the transfer of $60,000.
4. Gold Corporation has a basis in the land of $220,000.
5. None of the above
Explanation / Answer
3. Albert has a recognised gain on the transfer of $60,000