Bevis Bag Co. purchased a tract of land on August 31 of the current year, paying $225,000.
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Bevis Bag Co. purchased a tract of land on August 31 of the current year, paying $225,000. Prior to the sale, the seller paid property taxes of $18,000 on the property. The taxes covered the calendar year period January 1 through December 31.
a. Will Bevis be allowed to deduct any portion of the property taxes paid by the seller prior to the sale? If so, how much?
b. What will be Bevis' tax basis in the land?
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Related Book For
CCH Federal Taxation Basic Principles 2020
ISBN: 9780808051787
2020 Edition
Authors: Ephraim P. Smith, Philip J. Harmelink, James R. Hasselback
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