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Business, 21.10.2020 16:01 zykia1002

An office building with an adjusted basis of $320,000 was destroyed by fire on December 30, 2020. On January 11, 2021, the insurance company paid the owner $450,000. The fair market value of the building was $500,000, but under the co-insurance clause, the insurance company is responsible for only 90 percent of the loss. The owner reinvested $410,000 in a new office building on February 12, 2021, that was smaller than the original office building. What is the recognized gain and the basis of the new building if § 1033 (nonrecognition of gain from an involuntary conversion) is elected?

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An office building with an adjusted basis of $320,000 was destroyed by fire on December 30, 2020. On...
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