1. On October 1 of last year Rose Company, a calendar year C corporation, placed in service...
Question:
- 1. On October 1 of last year Rose Company, a calendar year C corporation, placed in service a $10,000,000 office building and allocated $4,000,000 of the cost to the land. On December 31 of the current year, Rose sold the office building for $12,000,000 and allocated $7,000,000 of the sales price to the building and the remaining $5,000,000 of the sales price to the land. How much of the $1231 gain is treated as capital gain in the current year?
2. Blue, Incorporated, a calendar year, accrual basis taxpayer, purchased equipment (7-year property) for $3,000,000 and placed it in service on October 1 of the current year. This was Blue's only depreciable property purchased during the year. Blue's taxable income is $800,000. Compute the maximum tax depreciation for the current year assuming Blue does not elect bonus depreciation.
3. In the current year, Joe sold stock to his brother Zach for $10,000. Joe purchased the stock two years ago for $15,000. Zach sold the stock to an unrelated party for $14,000. If Zach has $20,000 taxable income before the stock sale to an unrelated party, how much gain or loss did Zach recognize on the sale in the current year?
Federal Taxation 2021 Corporations, Partnerships, Estates & Trusts
ISBN: 9780135919460
34th Edition
Authors: Timothy J. Rupert, Kenneth E. Anderson, David S. Hulse