During 2022, Paul, an individual taxpayer, sells residential rental property for $180,000, which he acquired in 2001
Question:
During 2022, Paul, an individual taxpayer, sells residential rental property for $180,000, which he acquired in 2001 for $160,000. Paul has claimed straight-line depreciation on the building of $50,000. What is the amount and nature of Paul’s gain on the sale of the rental property?
a. $70,000 ordinary income
b. $10,000 ordinary income and $60,000 ordinary gain
c. $70,000 Section 1231 gain
d. $20,000 Section 1231 gain, $50,000 “unrecaptured depreciation”
e. None of the above
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Related Book For
Income Tax Fundamentals 2023
ISBN: 9780357719527
41st Edition
Authors: Gerald E. Whittenburg, Steven Gill
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