Identify Which of the Following Statements Is False

Multiple Choice

Identify which of the following statements is false.

A) Minority shareholders involved in a Sec. 332 subsidiary liquidation must recognize a gain or loss under the Sec. 331 general liquidation rules.
B) The parent corporation takes a basis in property received when liquidating a subsidiary corporation in a Sec. 332 liquidation equal to its basis to the subsidiary corporation.
C) Section 332 is applicable to both the parent corporation and the minority shareholders if they exist.
D) Property received by a minority shareholder takes a basis equal to its fair market value.