Residential real estate was purchased in 2014 for $375,000, held as rental property, and depreciated straight-line....

Residential real estate was purchased in 2014 for $375,000, held as rental property, and depreciated straight-line. Assume the land cost was $75,000 and the building cost was $300,000. Depreciation totaled $34,089. The building and land were sold on June 10, 2017, for $690,000 total. What is the tax status of the property, the nature of the gain from the disposition, and is any of it § 1250 depreciation recapture gain or unrecaptured § 1250 gain?

Expert Solution

ekkarill92 answered 1 year ago

which of the following statements about residential rental property are TRUE? The property may be depreciated...

which of the following statements about residential rental property are TRUE? The property may be depreciated using the ___________ a. ADS for a period of 30 years only by electing to in the first year the property is placed into service b. General Depreciation System for the period of 30 years c. GDS for a period of 40 years

Fox Realty purchased a residential property for $1,500,000. The latest available real estate assessment valued the...

Fox Realty purchased a residential property for $1,500,000. The latest available real estate assessment valued the property at $1,750,000 of which 20% was allocated to the land. How should record this acquisition on its books?

On February 1, Karin purchases real estate for $375,000. The annual property taxes of $5,040 are...

On February 1, Karin purchases real estate for $375,000. The annual property taxes of $5,040 are payable on December 31. Realizing that she will pay the property taxes for the entire year, Karin remits $374,580 to the seller at closing. Karin’s adjusted basis for the real estate is: a. $374,580 b. $375,000 c. $375,420 d. $379,620 Nat is a salesman for a real estate developer. His employer permits him to purchase a lot for $75,000. The employer’s adjusted basis for...

Calculate Lopez’s cost recovery deduction for 2019 if the building is: a. Classified as residential rental real estate. b. Classified as nonresidential real estate.

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A machine that cost $68,616 on January 1, 2014 was depreciated by Ava Company using the straight line method.

A machine that cost $68,616 on January 1, 2014 was depreciated by Ava Company using the straight line method. The machine had no residual value and a useful life of 8 Years. On January 1. 2017, the company switched to the sum of years’-digits method. What is the depreciation expense for the year ended December 31, 2017 $____

Carmen purchased a residential-rental property over in Yakima, where prices are much lower than in Seattle....

Carmen purchased a residential-rental property over in Yakima, where prices are much lower than in Seattle. She paid $125,000 for the house, in 2018. The appraisal indicated the land was worth $25,000, and the building was worth $100,000. How much “depreciation” expense can Carmen claim on her 2019 income tax return for this property? Choose the closest number, because the amounts below may not be exact. a. $ 0 b. $ 2,500 c. $ 3,600 d. $ 4,500 e. $...

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Your firm needs a $725,000 machine. If purchased, the machine will be depreciated straight-line over seven...

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Omar paid the following taxes this year (2020): Real estate taxes on rental property he owns...

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Jenny constructed a building for use as a residential rental property. The cost of the building...

Jenny constructed a building for use as a residential rental property. The cost of the building was $82,488, and it was placed in service on August 1, 1997. The building has a 27.5-year MACRS life. What is the amount of depreciation on the building for 2019 for tax purposes?

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