Essay About Fair Market Value And Such Corporation

Internal Revenue Code:sec. 351. Transfer to Corporation Controlled by Transferor
Sec. 351. Transfer to corporation controlled by transferor
(a) General rule
No gain or loss shall be recognized if property is transferred to
a corporation by one or more persons solely in exchange for stock
in such corporation and immediately after the exchange such person
or persons are in control (as defined in section 368(c)) of the
corporation.
(b) Receipt of property
If subsection (a) would apply to an exchange but for the fact
that there is received, in addition to the stock permitted to be
received under subsection (a), other property or money, then –
(1) gain (if any) to such recipient shall be recognized, but
not in excess of –
(A) the amount of money received, plus
(B) the fair market value of such other property received;
and
(2) no loss to such recipient shall be recognized.
(c) Special rules where distribution to shareholders
(1) In general
In determining control for purposes of this section, the fact
that any corporate transferor distributes part or all of the
stock in the corporation which it receives in the exchange to its
shareholders shall not be taken into account.
(2) Special rule for section 355
If the requirements of section 355 (or so much of section 356
as relates to section 355) are met with respect to a distribution
described in paragraph (1), then, solely for purposes of
determining the tax treatment of the transfers of property to the
controlled corporation by the distributing corporation, the fact
that the shareholders of the distributing corporation dispose of
part or all of the distributed stock, or the fact that the
corporation whose stock was distributed issues additional