(Answered) Question - for the past five years peter jones has owned

Accounting

Question - For the past five years, Peter Jones has owned all 100 shares of Trenton Corporation stock. This year, Mary Smith contributes property with a $50,000 basis and an $80,000 FMV for 80 newly-issued Trenton shares. At the same time, Peter contributes $15,000 in cash for 15 newly-issued Trenton shares.

Describe the tax issue(s) regarding the exchanges that Peter and Mary should consider.

Explain how this tax issue(s) would change if Peter and Mary were brother and sister.

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