Assume John sold his manufacturing business without using an installment note for the same 4million sales price on 2/1/22. The sale was allocated as follows: 2million for the building, 500k for machinery and equipment, and 1.5million as goodwill. The building was purchased for $750000 in November of 2009 and has accumulated depreciation of 160k and the machinery and equipment was purchased for 1million over the years (2009-2022) and has accumulated depreciation of 515k on the date of sale. Note the depreciation on the building was straight-line depreciation and the machinery and equipment used MACRS and section 179 elections

 

What is the realized gain, the section 1245 gain, section 1250 gain, and the section 1231 gain that would be reported? 

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The detailed answer for the above question is provided below Realized Gain The realized gain is the ... View the full answer