TP exchanged an apartment building with an adjusted basis of $100,000 and a FMV of $175,000 for land and a small rental house. The land had a FMV of $125,000 and the house had a FMV of $50,000. The apartment building was 19-year real property and accelerated depreciation of $200,000 had been taken. If straight-line depreciation had been used, only $125,000 of depreciation would have been taken. Hint: Has TP received enough 1250 property to cover the 1250 taint? If not, gain must be recognized to the extent of the excess. a. What is the realized and recognized gain on the exchange? b. What is the character of any recognized gain?

TP exchanged an apartment building with an adjusted basis of $100,000 and a FMV of $175,000 for land and a small rental house. The land had a FMV of $125,000 and the house had a FMV of $50,000. The apartment building was 19-year real property and accelerated depreciation of $200,000 had been taken. If straight-line depreciation had been used, only $125,000 of depreciation would have been taken. Hint: Has TP received enough 1250 property to cover the 1250 taint? If not, gain must be recognized to the extent of the excess. a. What is the realized and recognized gain on the exchange? b. What is the character of any recognized gain?

SWFT Comprehensive Volume 2019

42nd Edition

ISBN:9780357233306

Author:Maloney

Publisher:Maloney

Chapter13: Property Transactions: Determination Of Gain Or Loss, Basis Considerations, And Nonta Xable Exchanges

Section: Chapter Questions

Problem 85P

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