Question - List the tax issues that arise from the following situations, in question form. Followed by the code section which would address the issue. Do not answer the questions.
Jean and Paul are equal partners in the J&P Partnership. The partnership will form J&P Corporation by exchanging the assets and liabilities of the J&P Partnership for all of the corporation's stock on August 1 of the current year. The partnership will then liquidate by distributing the J&P Corporation stock equally to Jean and Paul. Both shareholders use the calendar year and desire that the corporation make an S election.
What tax issues should Jean and Paul consider with respect to this contemplated transaction? 1 Page.