Kevin owns 100% of the stock of Cardinal Corporation. In the current year, Kevin transfers an installment obligation (basis of $30,000 and fair market value of $200,000) for additional stock in Cardinal worth $200,000. Which gain, if any, will Kevin recognize on the transfer?
a) Kevin recognizes no taxable gain on the transfer.
b) Kevin has a taxable gain of $170,000.
c) Kevin has a taxable gain of $180,000.
d) Kevin has a basis of $200,000 in the additional stock he received in Cardinal Corporation.
e) None of the above