Art, an Unmarried Individual, Transfers Property (Basis of $130,000 and Fair

Multiple Choice

Art, an unmarried individual, transfers property (basis of $130,000 and fair market value of $120,000) to Condor Corporation in exchange for §1244 stock. The transfer qualifies as a nontaxable exchange under § 351. Because the property is loss property, Condor takes a basis of $120,000 in the property. Five years later, Art sells the Condor stock for $50,000. With respect to the sale, Art has:

A) An ordinary loss of $80,000.
B) An ordinary loss of $70,000 and a capital loss of $10,000.
C) A capital loss of $80,000.
D) A capital loss of $30,000 and an ordinary loss of $50,000.
E) None of these.