Three individuals transferred property to newly formed Triple Inc.in exchange for 1,000 shares of common stock.Mr.Albert transferred assets with a $50,000 tax basis in exchange for 820 shares,Mrs.Billig transferred assets with a $9,000 tax basis in exchange for 148 shares,and Mrs.Crisp transferred $4,000 cash for 32 shares.Based on the FMV of the transferred assets,each Triple share is worth $125.Which of the following is false?
A)Mr.Albert's tax basis in his 820 shares is $50,000.
B)Triple Inc.'s tax basis in the assets transferred by Mrs.Billig is $9,000.
C)Mrs.Crisp's tax basis in her 32 shares is $4,000.
D)None of the above is false.

Question

Quizplus · Accepted Answer

The statement "None of the above is false" is incorrect because Mrs. Crisp's tax basis in her 32 shares should be $4,000, which is the amount of cash she contributed, making all the other statements true.

Three Individuals Transferred Property to Newly Formed Triple Inc