Which of the Following Statements in Not Correct Regarding the Compliance

question 38

Multiple Choice

Which of the following statements in not correct regarding the compliance requirements of an involuntary conversion?

• A)The taxpayer elects the deferral by not reporting the gain as income for the first year in which the gain is realized although all relevant information regarding the event will be reported.
• B)A taxpayer who recognized the full gain and paid the taxes can later file a refund claim to elect the deferral if qualified property is acquired before the expiration of the replacement period.
• C)A taxpayer elects to defer the full gain in the year the gain is realized (year one),and no gain is reported on that year's tax return.Qualified replacement property is acquired in the following year (year two),but the full insurance proceeds are not spent so some gain must be recognized.The partial gain recognition will be reported on the tax return for year two.
• D)A taxpayer properly elected to defer the full realized gain in year one and provides appropriate information on the replacement property.The taxpayer cannot later revoke the election and designate a different property as the replacement property.

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Definitions:

Marine Biodiversity

The variety of life forms and ecosystems found in the ocean, including species diversity, habitat diversity, and genetic diversity.

Freshwater Biodiversity

The variety of life found in freshwater ecosystems, including lakes, rivers, and wetlands, comprising various species of plants, animals, and microorganisms.

Seaweeds

Marine algae that grow in oceans, rivers, and lakes, serving as an important ecosystem component and source of food and shelter for marine life.

Pharmaceuticals

Medicinal drugs manufactured for the treatment, prevention, or diagnosis of diseases in humans or animals.