Lesson 3A-Objectives

After completing this lesson, students should be able to:

1.	Discuss  section 351 as it relates to the general IRC rules for the recognition of gain or loss on the sale or exchange of property, and the rationale for 351, i.e. how it helps individual business owners do business in the corporate form.

2.	Discuss the meaning of the following terms as they are interpreted for purposes of section 351.

a.	Property
b.	Control
c.	“immediately after”
       
3.	Apply the rules of section 351 to hypothetical fact situations in light of the interpretation of the above terms.

4.	Understand the general rule regarding cancellation of indebtedness (COD) income, and how the general rule is affected by insolvency and by particular taxpayers’ methods of accounting.