Which of the Following Statements Is Correct for a §

question 242

Multiple Choice

Which of the following statements is correct for a § 1033 involuntary conversion of an office building which is destroyed by fire?

• A) An election can be made to postpone gain on a § 1033 involuntary conversion only if the proceeds received are reinvested in qualifying property no later than two years after the end of the tax year in which a proceeds inflow is received that is large enough to produce a realized gain.
• B) The postponement of realized gain in a § 1033 involuntary conversion is elective.
• C) The functional use test is satisfied if a business warehouse is replaced with another business warehouse.
• D) The taxpayer use test is satisfied if a shopping mall rented to tenants is replaced with an office building to be rented to tenants.
• E) All of the above are correct.

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Definitions:

Parallel Veins

Parallel veins refer to a vein pattern in plant leaves where the veins run parallel to each other lengthwise, typically found in monocot plants.

Monocot

Monocotyledon; flowering plant group; members have one embryonic leaf (cotyledon), parallel-veined leaves, scattered vascular bundles, flower parts in threes or multiples of three, and other characteristics.

Monocot

A group of flowering plants that are characterized by having a single seed leaf, or cotyledon, in addition to parallel leaf venation and scattered vascular bundles in stems.

Rhizoids

Thread-like structures that anchor nonvascular plants like mosses and liverworts to their substrates, but do not absorb nutrients like true roots.