Reg 3 Module 1

Question 1

When to use the value of the alternative date

Answer 1

If the alternative date is chosen, use which ever comes first, six months after death or distribution of inherited property.

Question 2

At what value should one recognize for inheritance.

Answer 2

0. No income tax on the value of inherited property.

Question 3

The qualifying tax payer rule to deduct total repairs and maintenance

Answer 3

if you make an average of gross receipts of 10 mil. prior 3 years.
A/B of building <1,000,000
And deduction has to be lesser of 10,000 or 2% of unadjusted basis.

Question 4

Basis of inherited Value is Rollover Basis but there is one exception

Answer 4

If sale price is greater than FMV and Basis is greater than FMV use basis.

Question 5

For De Minimis Rule to apply to deduct the entire for acquisitions and supplies, 2 things have happen

Answer 5

Applicable FS and written policy.

If no applicable FS then can deduct is purchase price does not exceed 2,500. Then you can deduct up to 500 per item.

Question 6

Basis of inherited property to the beneficiary is the:

Answer 6

FMV at the date of death or alternate valuation date.