Kim owns 100% of the stock of Cardinal Corporation. In the current year Kim transfers an installment obligation, tax basis of $30,000 and fair market value of $200,000, for additional stock in Cardinal worth $200,000.
a. Kim recognizes no taxable gain on the transfer.
b. Kim has a taxable gain of $170,000.
c. Kim has a taxable gain of $180,000.
d. Kim has a basis of $200,000 in the additional stock she received in Cardinal Corporation.
e. None of the above.