Subsequent Contribution. The facts are the same as paragraph (d)(3)(i) of this section, except that at the time of the October 5, 2019 distribution, A’s ad- justed basis in its X stock is $90. Fur- ther, on December 27, 2019, A contrib- utes $100 to X in a transaction de- scribed in section 351(a). The analysis in paragraph (d)(3)(ii) of this section remains the same, except that, unlike the second to last sentence of para- graph (d)(3)(ii)(C)(1) of this section, A’s basis in its X stock is reduced by $90 to $0 and pursuant to paragraph (b)(2)(iii) of this section, $10 is treated as gain from the sale or exchange of property. Additionally, as a result of the Decem- ber 27, 2019 contribution of $100, A’s basis in its X stock is increased by $100, so that at the end of 2019, A’s basis in its X stock is $100.
Appears in 2 contracts
Sources: Supplemental Contract, Publishing Agreement