Irene Irwin gave her son James a Section 1245 machine. The machine has an adjusted basis of
Question:
Irene Irwin gave her son James a Section 1245 machine. The machine has an adjusted basis of $25,000 and Irene had taken $10,000 in depreciation. James used the machine for 15 months and took $5,000 in depreciation before selling the machine for $30,000. What is the amount of depreciation Irene must recapture as ordinary income? What is James's gain on the sale and how is it treated?
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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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