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Under the proposed regulation, the inventory received by C from XYZ will not be dealt with as being issued for property because no Internet price was transferred. To circumvent the exchange from becoming disqualified below Sec. 351, C should really add additional home by having an FMV of at the very least $10,000.
To surrender net benefit to the transferee Company, a transferor would want to transfer assets with a value greater than the amount of liabilities assumed (or deemed assumed) because of the corporation additionally the quantity of any boot gained from the transferor. While in the absence of the exchange of Web benefit, the transactions would depict profits of property as opposed to issuance of inventory for residence (see preamble to Prop. Regs. Sec. 1.351-one).
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