An Exchange of Two Items of Personal Property (Personalty) That

question 19

True/False

An exchange of two items of personal property (personalty) that belong to different general business asset classes qualifies for nonrecognition under § 1031 as long as both properties are used in the taxpayer's trade or business.

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Definitions:

FICA Tax

A United States federal payroll tax that funds Social Security and Medicare, contributions are made by both employees and employers.

Social Security

A government system that offers financial assistance to people in the form of retirement benefits, disability income, and other payments.

Medicare

A federal health insurance program in the United States for people aged 65 and over, as well as for some younger people with disabilities.

Payroll Deductions

Amounts subtracted from an employee's gross salary for taxes, insurance premiums, benefits, and other payroll-related charges.