Exam 18: Comparative Forms of Doing Business

Match the following statements. a.Usually subject to single taxation even if the entity is incorporated. b.Not making distributions to shareholders. c.Rate for a corporate taxpayer is 21%. d.Subject to double taxation. e.Eligible for special allocations. -S corporations

Each of the following can pass profits and losses through to the owners: general partnership, limited partnership, S corporation, and limited liability company.

Match the following statements. a.Transaction in this form enables double taxation to be avoided. b.Gain or loss is calculated separately for each asset and is subject to single taxation. c.This is subject to double taxation. d.The sale is treated as the sale of a capital asset under § 741 but subject to ordinary income potential under § 751. e.This is not subject to double taxation on the sale of corporate stock. -Sale of an ownership interest by a partner.

Chen contributes property with an adjusted basis of $80,000 and a fair market value of $100,000 to a newly formed business entity.If the entity is a C corporation and the transaction qualifies under § 351, the corporation's basis for the property and the shareholder's basis for the stock are: