Ok the information is there. For EACH exchange listed (there are five total) ple

Question

Ok the information is there. For EACH exchange listed (there are five total) please figure out: 1. the realized gain or loss 2. the RECOGNIZED gain/loss 3. and basis of equipment recceived (which is column one)

Consider the following like-kind exchanges EE (Click the icon to view the like-kind exchanges.) Requirement Determine the realized gain or loss, the recognized gain or loss, and the basis of the equipment received for each like-kind exchange X r a "0" for any zero balances.) Data Table Recognized Gain (Loss) Basis of Equipment Received FMV of Equipment Received Basis of Equipment FMV of 0,000 $ 20,000 Exchanged $ 20,000 70,000 75,000 85,000 80,000 Boot Received 45,000 10,000 20,000 13,000 $ 50,000 120,000 80,000 75,000 40,000 Print Done Enter any number in the edit fields and then click Check Answer.

Explanation / Answer

Basis of Equipment Exchange( B) FMV of boot received (F) FMV of the Equiment Received ( E) Realizes Gain/(Loss) (G=E-B) Recognized Gain or loss [Lesser of (Realized gain / Loss or boot FMV)} Basis of Equipment Received ( E-Realized gain+Recognized Loss) A $20,000 $0 $50,000 $30,000 $0 $20,000 B $70,000 $45,000 $120,000 $50,000 $45,000 $115,000 C $75,000 $10,000 $80,000 $5,000 $5,000 $80,000 D $85,000 $20,000 $75,000 -$10,000 $0 $85,000 E $80,000 $13,000 $40,000 -$40,000 $0 $80,000 According to section 1031 no gain or loss shall be recognized on exchange of like kind of property held for business The gain or loss is postponed/deferred Now boot is cash and it is not like kind property, so it is value at FMV For Boot received, gain is recognized to the extent of lesser of the gain realized or the boot received Basis of Property Received=FMV of property Received-postponed gain+Postponed Loss

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