Ted owns a warehouse that cost $850,000 in 1984 and is subject to depreciation recapture under Sec.
Question:
Ted owns a warehouse that cost $850,000 in 1984 and is subject to depreciation recapture under Sec. 1245. The warehouse, which has an adjusted basis of zero, is destroyed by a tornado and Ted receives $580,000 from the insurance company. Within nine months, he pays $500,000 for a new warehouse and an election is made to defer the gain under Sec. 1033. What is the amount and character of Ted’s recognized gain?
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Ted may elect to defer 500000 of the realized gain of 580000 5800...View the full answer
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