Patty Leave owned an apartment house for ten years. Depreciation was taken on a straight-line basis. When Patty's adjusted basis for this property was $200,000, she traded it for an office building having a fair market value of $600,000. The apartment house has 100 dwelling units, while the office building has 40 units rented to business enterprises. The properties are not located in the same city. What is Patty's reportable gain on this exchange

$0

Explanation:

IRS's Section 1031 allows real estate investors to exchange real properties and defer any capital gains tax. In this case, Patty doesn't need to report any gain because she is exchanging her apartment house (with 100 rented apartments) for an office building (with 40 rented offices).

In order for a property to classify as a 1031 exchange, it must involve properties that have similar uses. In this operation, both properties have rental units.

answer; limited pay life;

answer/// equals both average variable cost and average total cost at their respective minimums;