[ServiceContract]
public interface IShapeTest
{
  [OperationContract]
  AbsShape EchoShape(AbsShape shape);
}

public class ShapeTestImpl : IShapeTest
{
  public AbsShape EchoShape(AbsShape shape)
  {
    return shape;
  }
}

[KnownType(typeof(Square))]
public abstract class AbsShape
{
  [DataMember]
  public int numSides;
}

public class Square : AbsShape
{
  public Square() : base()
  {
    numSides = 4;//set the numSides to 'prove' it works
  }
}

<xs:complexType name="AbsShape" abstract="true"> <!--NOTE abstract="true"-->
  <xs:sequence>
    <xs:element minOccurs="0" name="numSides" type="xs:int"/>
  </xs:sequence>
</xs:complexType>

<xs:complexType name="AbsShape"> <!--NOTE the lack of abstract="true"-->
  <xs:sequence>
    <xs:element minOccurs="0" name="numSides" type="xs:int"/>
  </xs:sequence>
</xs:complexType>