Property Tax SIM 1 Flashcards
Results from the sale of assets used in a trade or business for more than a year, such as land, buildings, or equipment, which are not held as inventory
1231 gain loss
Gain from sale of stock held 10 months
Excess of sales price over tax basis of a car inherited 3 months prior to sale
Portion of a gain on the sale of a machine that is taxed as ordinary income
1245 gain - recapture
Results from recapture of depreciation on real property
1250 gain - recapture
Gains are long-term capital gains and losses are ordinary if held for more than one year
Section 1231 gain or loss
Gain on sale of personal jewelry held long term
long term capital gain - collectable
Loss on the sale of the personal residence lived in by the taxpayer and held long term
not deductible
Results from recapture of depreciation on personal property
section 1245 gain
Gambling losses in a period in which there were no gambling winnings
not deductible
Difference between sales price and cost of goods held as inventory for sale in the ordinary course of business held 13 months
ordinary business income loss
Results from the sale of assets, such as land, buildings, or equipment, used in a trade or business for one year or less
ordinary income or loss
Excess of sales price over tax basis of a car inherited 3 months prior to sale
long term gain
where do you report gain and losses on investment assets
1040 schedule D
where do you report gains and losses from business asset transactions
form 4797 - sale of business property
What about paintings
They are considered person capital asset - if sold at a gain - the tax would be considered a collectible - max of 28%
What if you sell a building inside of one year
any depreciation you took in that year is considered “additional depreciation” and is considered subject to 1250 - real property recapture
What can you apply installment sales to
the sale of property
CANT use for - stocks or securities
CANT use on property used in the ordinary course of business
If you are an equal partner in a partnership are you considered a “related party”
yes - partners are related parties
