Individual Income Taxes
43rd Edition
ISBN: 9780357109731
Author: Hoffman
Publisher: CENGAGE LEARNING - CONSIGNMENT
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Chapter 17, Problem 9CPA
To determine
Identify the option to which Section 1245 recapture can be applied.
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Students have asked these similar questions
A gain on the disposition of Section 1245 property is treated as ordinary income to the extent of:
Excess accelerated depreciation allowed or allowable over the depreciation figured for the same period using the straight-line method.
Excess appreciated value over depreciation allowed or allowable using the straight-line method.
The difference between the amount realized over the cost of the property.
Depreciation allowed or allowable (not to exceed the realized gain).
Depreciation on rental property is an
A. expense deductible against income
B. out-of-pocket expense to the owner.
C. Item which must be capitalized.
D. Itemized one-time deduction.
What are the two major treatments of a superficial loss on a sale and repurchase of identical properties by an individual?
Question 6 options:
a)
Loss deducted and same loss added to income
b)
Loss disallowed and same loss added to ACB of substituted property
c)
Loss decreased in the year and same loss disallowed in the future year
d)
Loss changed to gain and same loss is adjusted to cost of sold property
Chapter 17 Solutions
Individual Income Taxes
Ch. 17 - Prob. 1DQCh. 17 - Prob. 2DQCh. 17 - Prob. 3DQCh. 17 - Prob. 4DQCh. 17 - Prob. 5DQCh. 17 - Prob. 6DQCh. 17 - Prob. 7DQCh. 17 - A depreciable business dump truck has been owned...Ch. 17 - Prob. 9DQCh. 17 - Prob. 10DQ
Ch. 17 - Prob. 11DQCh. 17 - Prob. 12DQCh. 17 - Prob. 13DQCh. 17 - Prob. 14DQCh. 17 - Prob. 15DQCh. 17 - Prob. 16DQCh. 17 - Prob. 17DQCh. 17 - Prob. 18DQCh. 17 - Prob. 19DQCh. 17 - Prob. 20DQCh. 17 - Prob. 21CECh. 17 - Prob. 22CECh. 17 - LO.3 Renata Corporation purchased equipment in...Ch. 17 - LO.3 Jacob purchased business equipment for 56,000...Ch. 17 - Sissie owns two items of business equipment. Both...Ch. 17 - Prob. 26CECh. 17 - Prob. 27CECh. 17 - LO.4 Enzo is a single taxpayer with the following...Ch. 17 - Prob. 29CECh. 17 - Prob. 30CECh. 17 - LO.1, 2 Jenny purchased timber on a 100-acre tract...Ch. 17 - Prob. 32PCh. 17 - LO.2 A sculpture that Korliss Kane held for...Ch. 17 - Prob. 34PCh. 17 - Prob. 35PCh. 17 - Prob. 36PCh. 17 - Prob. 37PCh. 17 - Prob. 38PCh. 17 - Prob. 39PCh. 17 - Prob. 40PCh. 17 - Prob. 41PCh. 17 - Prob. 43PCh. 17 - Joanne is in the 24% tax bracket and owns...Ch. 17 - Prob. 45PCh. 17 - Prob. 46PCh. 17 - Prob. 47PCh. 17 - Prob. 48PCh. 17 - Prob. 49PCh. 17 - Jasmine owned rental real estate that she sold to...Ch. 17 - Prob. 51PCh. 17 - Prob. 52PCh. 17 - Prob. 53PCh. 17 - Prob. 54PCh. 17 - Jay sold three items of business equipment for a...Ch. 17 - Prob. 1RPCh. 17 - Prob. 2RPCh. 17 - Prob. 3RPCh. 17 - Prob. 4RPCh. 17 - Prob. 1CPACh. 17 - Prob. 2CPACh. 17 - Jerry uses a building for business purposes. The...Ch. 17 - Prob. 4CPACh. 17 - Prob. 5CPACh. 17 - Prob. 6CPACh. 17 - Wally, Inc., sold the following three personal...Ch. 17 - Net Section 1231 losses are: a. Deducted as a...Ch. 17 - Prob. 9CPACh. 17 - Prob. 10CPA
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- 26. What is the general formula for calculating the gain or loss realized on the sale or other disposition of property? Include in your answer a discussion of how to calculate each "element" of the formula for calculating gain or loss realized, assuming that the property is purchased at original cost. Also, discuss common circumstances where the basis of property is "adjusted" over time.arrow_forwardThe sale of a depreciable asset resulting in a gain indicates that the proceeds from the sale were a. Less than current market value b. Greater than cost c. Greater than book value d. Less than book valuearrow_forwardWhy is depreciation added to Net CAPEX? A To adjust CAPEX for taxable income B To isolate changes due to buying or selling of CAPEX с To reflect the economic value of the fixed assetsarrow_forward
- 11 In a taxable asset acquisition, the seller would likely pay ordinary income taxes on the gain resulting from the sale of which of the following assets: a. Inventory b. Accounts Receivable c. Recaptured Depreciation Amounts under IRC 1245 d. All of the abovearrow_forward72 When an owner-occupied property is transferred to investment property at fair value, a decrease in the carrying amount of the property to its fair value at the date of transfer Group of answer choices is carried directly to equity. is recognized in profit and loss at all times. is recognized in profit and loss, or, for a revalued property, charged against the revaluation surplus to the extent of its credit balance. is absorbed by retained earnings.arrow_forwardWhich of the following statements is correct with respect to the sale of a depreciable asset? Multiple Choice A gain occurs when the selling price exceeds book value. A sale for a gain results in a decrease in total assets. A sale for a loss results in an increase in total assets. A loss occurs when the selling price is more than book value.arrow_forward
- What is the amount realized in a transaction? The gain on the sale of an asset The proceeds less the basis The sum of any money received plus the fair market value of other property received The portion of the gain that is recognizedarrow_forwardIf a loss from sale or exchange of property between related parties is disallowed and the property is subsequently sold to an unrelated party, a.The disallowed loss is lost forever. b.The disallowed loss may be used if there is a further loss on the subsequent sale. c.The unrelated party may claim the loss previously disallowed. d.An amended return may be filed to claim the loss previously disallowed. e.The disallowed loss may be used to offset gain on the subsequent sale.arrow_forwardSection 291 depreciation recapture for corporations provides that what portion of the gain on depreciable real property will be recognized as ordinary income?arrow_forward
- Gains and Losses results from realization events such as: a. sales, purchases, exchanges, or other disposition of property. b. sales, exchanges, or other disposition of property. c. Disposition , sales and donations. d. all of the above.arrow_forwardThe sale of a depreciable asset resulting in a loss indicates that the proceeds from the sale are a. Lesser than cost b. Less than current fair value c. Lesser than carrying amount d. Greater than carrying amount e. Greater than costarrow_forward1. When reclassification is made from owner occupied property to investment property that will be carried at fair value, any excess of the fair value over the carrying amount at the date of transfer is a. ignored. b. recognized as a gain in profit or loss, c. credited to asset revaluation surplus. d. recorded as a credit to a liability account2. Which of the following are valid statements regarding measurement of investment property? I. The best evidence of fair value is current price in an active market for similar property in the same location and condition.II. When items of investment property are measured at fair values, any movement in fair value is credited to other comprehensive income under the heading revaluation surplus.III. An entity shall continue to measure an investment property at fair value until its disposal if it has previously valued the property at fair value.IV. Transaction costs directly attributable to acquisition of investment property are capitalized as…arrow_forward
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