All of the Following Are True Except

question 94

Multiple Choice

All of the following are true except

• A)a nonsimultaneous exchange may never qualify as a like-kind exchange.
• B)nonrecognition of gains and losses is mandatory if the exchange is a like-kind exchange.
• C)a loss may be recognized on non-like-kind property (boot)if the taxpayer transfers the boot in an otherwise like-kind exchange.
• D)the holding period of like-kind property received includes the holding period of the property exchanged.

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Definitions:

Available-For-Sale Security

A financial asset that is purchased with the intent of selling before its maturity date but not classified as actively traded or held to maturity.

Realized Gain

The profit made from the sale of an asset, which becomes evident upon completion of the transaction.

Fair Value

The estimated market price of an asset or liability, assuming knowledgeable, willing parties in an arm's length transaction.

Readily Marketable

Assets that can be quickly converted into cash with minimal impact on their price.