Question 40 fof 50) Save & Exit Submit Time remaining: 0:46.15 0 You did not rec

Question

Question 40 fof 50) Save & Exit Submit Time remaining: 0:46.15 0 You did not recelve full credit for this question in a previous attempt Bred sold a rental house that he owned for $247000. Brad bought the rental house ive years ago for $28.,000 and has ciaimed $48.500 of depreciation expense. What is the amount and character of Brad's gain or loss? O $67500 capital gain. O None of the choices are correct $19,000 11231 gain and $48.500 unrecaptured S1250 9 O $67.500 ordinary gain ·$19000 ordinary and$48,500 unrecaptured S1250 gain. Previous attempt MacBook Air 0 3 4 5 6 .9 0

Explanation / Answer

Answer : $ 19000 section 1231 gain and $ 48500 unrecaptured section 1250 gain

Unrecaptured section 1250 recaptures the lesser depreciation taken ($48500 ) or gain $ 67500.

This amount is then taxed at no more than 25%.The remaining $ 19000 gain would be section 1231 gain.

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