Michael would like to exchange land that he owns (adjusted basis $125,000 and FMV of $160,000) for land in a neighboring county (adjusted basis $108,000 and FMV $126,000) plus cash of $34,000. Assume that the parcels of land are qualified property for treating this as an excluded transaction, and that the cash is boot. (a) Your answer is correct. What is Michael's realized gain? (Do not leave any field blank. If answer is zero, please enter O for the amount.) (b) Realized gain $ eTextbook and Media Your answer is incorrect. What is Michael's recognized gain? (Do not leave any field blank. If answer is zero, please enter O for the amount.) Recognized goin 35000 4 Attempts: 1 of 3 used

Michael would like to exchange land that he owns (adjusted basis $125,000 and FMV of $160,000) for land in a neighboring county (adjusted basis $108,000 and FMV $126,000) plus cash of $34,000. Assume that the parcels of land are qualified property for treating this as an excluded transaction, and that the cash is boot. (a) Your answer is correct. What is Michael's realized gain? (Do not leave any field blank. If answer is zero, please enter O for the amount.) (b) Realized gain $ eTextbook and Media Your answer is incorrect. What is Michael's recognized gain? (Do not leave any field blank. If answer is zero, please enter O for the amount.) Recognized goin 35000 4 Attempts: 1 of 3 used

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 37CE

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Complete the following table involving certain involuntary conversions in which the taxpayer elects to defer gain. The property is converted into cash and the cash is invested in qualifying replacement property in each case. Each case is independent of the others. Asset A B с Blank 1 Amount realized 8.500 6,000 5.500 Add your answer Blank 2 Add your answer Blank 3 Add your answer Blank 4 Add your answer Blank 5 Add your answer Blank 6 Add your answer Adjusted Basis 7.500 3,400 3.500 Amount reinvested 9,000 3,500 5,000 Gain(loss) recognized Blank 1 Blank 3 Blank 5 Basis in Replacement Blank 2 Blank 4 Blank 6
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Jennifer transfers properties to Mump Co. in an exchange that meets all the requirements of Code Sec. 351. Several of the transferred properties are subject to liabilities. Will property transfers of this sort cause gain recognition for Jennifer?
Your client and his wife plan to purchase a new home. They want a form of property ownership that: will transfer title at death outside the probate process; will allow each spouse, while alive, to have a vested one-half interest in the property; guarantees that the surviving spouse will receive the property when the other spouse dies; and allows lifetime disposition by one spouse of their property interest without requiring the consent of the other spouse. Assuming that all the forms of ownership below are available in the state where the property is located, what is the form of titling that will best achieve all of their objectives? A) Community property B) Tenancy by the entirety C) Joint tenants with right of survivorship D) Tenants in common
Pick correct one Which of the following statements is true? A. Realized gain and recognized gain are the same and can be used interchangeably. B. When boot is given in a like-kind exchange, recognized gain is the greater of the boot or the realized gain. C. To qualify as a like-kind exchange, real property must be exchanged either for other real property or for personal property. D. If boot is received in a like-kind exchange, the recognized gain cannot exceed the realized gain. E. Kate exchanges land held as an investment for a investment building owned by Clark. This exchange is not qualified as like-kind exchange because they exchange developed real property with non-developed real property.
a. What amount of gain or loss does Zhang recognize on the transfer of the property to her corporation? b. What is Zhang’s tax basis in the stock she receives in the exchange?
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Select the best answer. Which of the following statements regarding transfers of property or services is true? For a transfer of property to a corporation, no gain is recognized by the taxpayer if the O A. transferred property is encumbered with liabilities in excess of the taxpayer's basis in the property. O O O If receipt of stock is subject to a substantial risk of forfeiture, income is recognized by th B. recipient in the year the stock is received even though the substantial risk of forfeiture h lapsed. If the contributing partner receives a capital interest in the partnership upon contributi C. services, the contributor will be taxed on the transfer when the contributor actually rec profits. In order for an exchange of services to a partnership for a profit interest to qualify as a D. nontaxable event, the service partner must provide services to the partnership or for it benefit, and the services must be provided by the service partner in his capacity as a p Submit Answers
Question 1: If you inherited a parcel of forested land and were deciding whether to sell it and buy federal government bonds now or keep the land for a few years and sell it, how would you arrive at your final course of action?
1 Jamie plans to transfer a piece of equipment which is capital property to him, to a corporation he owns. The equipment has an Adjusted Cost Base (ACB) of $90,000, a Undepreciated Capital Cost (UCC) balance of $60,000 and a Fair Market Value (FMV) of $70,000. Jamie has $10,000 in taxable capital losses that he is concerned he won't be able to use in the future. What would you recommend to Jamie as an elected amount if he wants to defer as much tax as he can and use the losses?
The Abelinda Estate distributed some land, basis of $15,500 and fair market value of $18,000, to beneficiary Bartholomaus. The estate is subject to a 28% marginal income tax rate, and Bartholomaus is subject to a 32% marginal rate. What are the tax savings if the executor of the estate elects that the entity recognize the related realized gain? Please note that I came up with $125 & it is incorrect.
Problem 11-56 (LO 11-6) (Algo) [The following information applies to the questions displayed below.] Kase, an individual, purchased some property in Potomac, Maryland, for $225,000 approximately 10 years ago. Kase is approached by a real estate agent representing a client who would like to exchange a parcel of land in North Carolina for Kase's Maryland property. Kase agrees to the exchange. What is Kase's realized gain or loss, recognized gain or loss, and basis in the North Carolina property in each of the following alternative scenarios? (Loss amounts should be indicated by a minus sign. Leave no answers blank. Enter zero if applicable.) Problem 11-56 Part-a (Algo) a. The transaction qualifies as a like-kind exchange, and the fair market value of each property is $800,000. Description Amount Realized gain Recognized gain Adjusted basis in new property $ $ $ 575,000 0 225,000