Some tax rules can be justified on multiple grounds (e.g. Economics, social, etc

Question

Some tax rules can be justified on multiple grounds (e.g. Economics, social, etc.). In this connection, comment on the possible justification for the rules governing the following:
a. Energy conservation and pollution control
b. Pension plans
c. Education
d. Home ownership
The state highway department condemns some of Chad’s grazing land. The land cost Chad $20, 000, and the condemnation award is the land’s fair market value of $100,000. Shortly after the condemnation, Chad buys replacement grazing land. What is his recognized gain if the replacement land cost?
A $70,000?
B $110,000?
C $20,000?
D what, if any, is the justification for deferring the recognition of gain on the involuntary conversion?

Explanation / Answer

replacement land cost :

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