Marcus sold a residential rental building for a gain of $30,000. He had originally purchased the building and placed it in service in March 2016 (for simplicity, the sale of land is not included in this question). The amount of depreciation allowed or allowable was $14,250. There were no other adjustments to the basis of the property and Marcus did not sell any other property during the tax year. What is the amount and nature of Marcus's gain?

A. $15,750 gain taxed as a long-term capital gain and $14,250 gain taxed at a maximum of 25%.

B. $15750 gain taxed S a long-term capital gain and $14,250 gain added to business income.

C. $30,000 gain taxed as a long-term capital gain and $14,250 gain taxed at a maximum of 25%. D. $30,000 gain taxed as a long-term capital gain and $14,250 gain added to business income.

Answer rating: 100% (QA)

The detailed answer for the above question is provided below The correct answer is optionB ... View the full answer