Chet owns a factory building that he has used in his business for many years. On...

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Chet owns a factory building that he has used in his business for many years. On 1/28/20, the factory was totally destroyed in a fire. Chet received S 5.000.000 from his insurance company for this total loss. At the time of this loss, Chet had an adjusted basis in this factory of $ 4,000,000 (5 6.000.000 original cost less $ 2,000,000 in accumulated straight-line tax depreciation). Chet replaced the factory at a cost of $ 4,900,000 in November of 2020. Part a (1.7 points) Calculate Chet's 2020 realized gain of loss from the above. 2020 realized gain or loss) - $ Part b (1.7 points) How much gain or loss will Chet recognize for tax purposes in 2020? 2020 recognized gain or loss) -5 Part c (1.7 points) How much additional federal tax will Chet incur in 2020 assuming his marginal ordinary income tax rate is 37% and his net capital gain rate is 20%7 2020 additional tax-5 Part d (1.7 points) What is Chet's tax basis is the replacement factory building? Tax basis in new factory-S Chet owns a factory building that he has used in his business for many years. On 1/28/20, the factory was totally destroyed in a fire. Chet received S 5.000.000 from his insurance company for this total loss. At the time of this loss, Chet had an adjusted basis in this factory of $ 4,000,000 (5 6.000.000 original cost less $ 2,000,000 in accumulated straight-line tax depreciation). Chet replaced the factory at a cost of $ 4,900,000 in November of 2020. Part a (1.7 points) Calculate Chet's 2020 realized gain of loss from the above. 2020 realized gain or loss) - $ Part b (1.7 points) How much gain or loss will Chet recognize for tax purposes in 2020? 2020 recognized gain or loss) -5 Part c (1.7 points) How much additional federal tax will Chet incur in 2020 assuming his marginal ordinary income tax rate is 37% and his net capital gain rate is 20%7 2020 additional tax-5 Part d (1.7 points) What is Chet's tax basis is the replacement factory building? Tax basis in new factory-S

Answer rating: 100% (QA)

To calculate Chets 2020 realized gain or loss we need to determine the difference between the insurance proceeds received and the adjusted basis of th... View the full answer