Which of the Following Would Extinguish the § 1245 Recapture

question 12

Multiple Choice

Which of the following would extinguish the § 1245 recapture potential?

• A) An exchange of depreciable business equipment for like-kind business equipment with gain realized, but not recognized.
• B) A nontaxable incorporation under § 351.
• C) A nontaxable contribution to a partnership under § 721.
• D) A nontaxable reorganization.
• E) None of the above.

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Definitions:

Prototype Theory

A theory in cognitive science that suggests humans categorize objects and concepts in terms of typical or representative examples.

Bird

A warm-blooded vertebrate of the class Aves, characterized by feathers, beaks, the laying of hard-shelled eggs, and (in most cases) the ability to fly.

Identify

To establish or indicate who or what (someone or something) is.

Folk Theories

Informal, intuitive, and often culturally specific beliefs or explanations about the world and how it works, not necessarily based on scientific evidence.