Mitch, an NRA, Sells a Building in Omaha for $1

question 36

Multiple Choice

Mitch, an NRA, sells a building in Omaha for $1 million. His basis in the building is zero for both regular tax and AMT purposes. Mitch has no other contact with the United States other than the ownership of the building. How much Federal income tax is due from Mitch on the sale?

• A) $0, because Mitch is an NRA.
• B) The amount realized times the top individual tax rate.
• C) The net gain times the top capital gains tax rate.
• D) The net gain taxed at the lesser of the applicable regular or AMT rates.

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Definitions:

UCC

The Uniform Commercial Code encompasses a thorough framework of legal rules that manage commercial transactions throughout the United States.

Security Agreement

A legal contract that grants a lender a security interest in an asset, which serves as collateral for a loan.

Standards

Established requirements, criteria, or guidelines commonly used for comparison, measurement, or quality assessment.

Default

Failing to fulfill a legal obligation or agreement, particularly in paying back a loan.