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Question: Sam wants to purchase land owned by Kiara for use in his trade or business. Kiara's basis in the land is $350,000, and Sam has offered to pay $980,000 if she will sell within the next ten days. Kiara is interested in selling but wants to avoid gain recognition on the sale. Is there any way that Kiara could sell to Sam and still avoid gain recognition? Give Short Explanation of Capital Gains and 1031 exchange.

Question: Sam wants to purchase land owned by Kiara for use in his trade or business. Kiara's basis in the land is $350,000, and Sam has offered to pay $980,000 if she will sell within the next ten days. Kiara is interested in selling but wants to avoid gain recognition on the sale. Is there any way that Kiara could sell to Sam and still avoid gain recognition? Give Short Explanation of Capital Gains and 1031 exchange.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question: Sam wants to purchase land owned by Kiara for use in his trade or business. Kiara's basis in the land is $350,000, and Sam has offered to pay $980,000 if she will sell within the next ten days. Kiara is interested in selling but wants to avoid gain recognition on the sale. Is there any way that Kiara could sell to Sam and still avoid gain recognition? Give Short Explanation of Capital Gains and 1031 exchange.
Transcribed Image Text:Question: Sam wants to purchase land owned by Kiara for use in his trade or business. Kiara's basis in the land is $350,000, and Sam has offered to pay $980,000 if she will sell within the next ten days. Kiara is interested in selling but wants to avoid gain recognition on the sale. Is there any way that Kiara could sell to Sam and still avoid gain recognition? Give Short Explanation of Capital Gains and 1031 exchange.
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