Bob, not a dealer, sold an apartment building for $600,000. His adjusted basis in the building was $350,000 and it was subject to $40,000 of depreciation recapture. Bob received $150,000 in the year of sale, the buyer assumed Bob’s mortgage payable of $240,000, and the buyer gave Bob an 8% (the current Federal rate) note of $210,000 due in five years. The interest on the note was payable each June 30, beginning in the year following the year of the sale. Bob incurred $30,000 of selling expenses which he paid in the year of sale. Compute Bob’s installment sales gain that should be reported in the year of sale.
Bob, not a dealer, sold an apartment building for $600,000. His adjusted basis in the building was $350,000 and it was subject to $40,000 of depreciation recapture. Bob received $150,000 in the year of sale, the buyer assumed Bob’s mortgage payable of $240,000, and the buyer gave Bob an 8% (the current Federal rate) note of $210,000 due in five years. The interest on the note was payable each June 30, beginning in the year following the year of the sale. Bob incurred $30,000 of selling expenses which he paid in the year of sale. Compute Bob’s installment sales gain that should be reported in the year of sale.
Chapter13: Property Transact Ions: Determination Of Gain Or Loss, Basis Considerations, And Nontaxable Exchanges
Section: Chapter Questions
Problem 80P
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Bob, not a dealer, sold an apartment building for $600,000. His adjusted basis in the building was $350,000 and it was subject to $40,000 of
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ISBN:
9780357109731
Author:
Hoffman
Publisher:
CENGAGE LEARNING - CONSIGNMENT