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Unformatted text preview: appears 11 Minority Interest
Tax consequences to the liquidating corporation
Nonrecognition of gain or loss under § 337 only applies
to the actual property transferred to the parent
Actual property transferred to the minority shareholders
is governed by § 336
§ 336 requires recognition of gain, however, no loss will be
recognized because of § 336(d)(3) 12 Minority Interest (Cont’d)
Tax consequences to the recipients
The parent corporation will be governed by § 332 (no
gain or loss) and § 334(b)(1) (transferred basis)
The minority shareholders will be governed by § 331
(sale of stock) and § 334(a) (FMV basis) 13 Questions about End-of-Chapter Problems
for Chapter 5? 14...
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This note was uploaded on 04/04/2014 for the course ACCT 7375 taught by Professor Staff during the Fall '08 term at University of Houston.
- Fall '08