On February 24, 20X1, Abner’s business building (AB 1.3 million), was destroyed by fire. On March...

On February 24, 20X1, Abner’s business building (AB 1.3 million), was destroyed by fire. On March 30, 20X1, Abner receives an insurance reimbursement of $1.65 million for the loss. Abner invests 1.55 million in a new building and buys stock with the balance of the insurance proceeds. Abner is a cash basis taxpayer. Assuming Abner’s replacement property qualifies, what is Abner’s: a. Realized gain? b. Recognized gain? c. Basis in the replacement building?

Expert Solution

ekkarill92 answered 2 years ago

Nick had a business building destroyed in a fire. The old building was purchased for $375,000...

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