Section 351 Statement

Both the corporation and any person involved in a nontaxable exchange of property for stock must attach to their income tax return a complete statement of all facts pertinent to the exchange.

Section 351 statement. 1 351 3 a enter information to product the statement pursuant to re. In boxes 70 through 104 transferee corporation reg. What is a section 351 a tax free exchange.

1 351 3 b enter. Section 351 has been described as a deliberate attempt by congress to facilitate the incorporation of ongoing businesses and to eliminate any technical constructions which are economically unsound hempt bros inc. For more information see section 1 351 3 of the regulations.

To prepare the statements. Navigate to the federal interview form statements. In 1997 congress amended section 351 to exclude the receipt of nonqualified preferred stock from non recognition.

Satisfy the control requirement of 351. A every person who received the stock or securities of a controlled corporation or other property as part of the consideration in exchange for property under section 351 shall file with his income tax return for the taxable year in which the exchange is consummated a complete statement of all facts pertinent to such exchange including. Generally transferring property into a corporation in exchange for its stock is a taxable event.

A statement under paragraph b of this section if all of the information that would be included in the statement described in paragraph b of this section is included in any statement s described in paragraph a of this section that is attached to the same return for the same section 351 exchange. Go to federal interview form stmt 8 statement pursuant to reg. Every significant transferor must include a statement entitled statement pursuant to 1 351 3 a by insert name and taxpayer identification number if any of taxpayer a significant transferor on or with such transferor s income tax return for the taxable year of the section 351 exchange.

The transaction is treated as if you sold property to the corporation in return for cash. 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. United states 490 f 2d 1172 1177 3d cir cert.