Xco is an accrual basis taxpayer with multiple lines of businesses. One business is a gas station. The land underneath the gas station did not appear contaminated when Xco purchased it. However, the land now has potential soil and groundwater problems (environmental liabilities). Xco engaged in a section 351 tax free exchange transferring the gas station to a new subsidiary Sco in exchange for the stock of Sco and the assumption of the environmental liabilities. (Xco controls Sco)
Before the transfer, Xco did not take any environmental remediation efforts to clean up the landâssoil and groundwater problems. (No change in basis perhaps?)
How is the basis of Xcoâs land determined? (Sco takes the same basis as Xco, but I don’t knowhow Xco determined their basis. Historical?)
Travelling Experience
Can you remember your best experince in another country? Last summer (in 2007), I traveled to the United States for working and spending some time with my friends. I stayed two months in that country. I decided to travel because I wanted to do something different. I was bored about all my daily activities, so […]
