In: Accounting
T/F
10. An exchange of an office building for a farm is not considered to be a like-kind exchange.
11. If each party assumes a liability of the other party, only the net liability given or received is treated as boot.
12. The holding period of the like-kind property given up carries over to the holding period of the like-kind property received.
10) An exchange of an office building for a farm is not considered to be a like-kind exchange.
False. Like-kind property needs not to be the same. A farm qualifies to be a like kind property. A farm is considered as a like-kind property to apartment buildings, raw land, industrial properties, etc are all like-kind.
11) If each party assumes a liability of the other party, only the net liability given or received is treated as boot.
True. The tax payer whose liability is assumed is treated as boot. In case, watch party assumes a liability of the other party, the liabilities are offset and only the excess is treated as boot.
12) The holding period of the like-kind property given up carries over to the holding period of the like-kind property received
True. The holding period of the like kind of property received given up carries over and tack on to the holding period of the like-kind property received.