Discussion:Accounting basis of non-cash contribution

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Discussion Forum Index --> Accounting Questions --> Accounting basis of non-cash contribution

Wsbjr1 (talk|edits) said:

14 October 2007
The tax basis of property contributed to capital by a person other than a shareholder is zero (pub. 542, pg. 5). For accounting purposes, is the basis also zero, or would it be FMV? If FMV and it is a depreciable asset, would book depreciation be taken on this asset but not tax depreciation?

Natalie (talk|edits) said:

October 15, 2007
Why would you want to book the asset at FMV? Is book basis the same as tax basis, without considering FMV?

Summa (talk|edits) said:

17 October 2007
Yes Wsbjr1, you are right. The book basis will be FMV at the time of the contribution and the tax basis will be zero. The book depreciation will be based on GAAP (the remaining useful life of the asset), and you will recieve no tax depreciation.

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