Hansa Invested in a Piece of Land Seven Years Ago

question 9

Multiple Choice

Hansa invested in a piece of land seven years ago when real estate prices were rising in his area and land values were expected to double within five years.The land remained vacant and was only used in 2018 when Hansa was approached to rent the land for two weeks for a local carnival for a fee of $1,000.It is now 2020 and Hansa has been offered a significant sum of money for the land in response to an advertisement in a local newspaper.Based on Hansa's primary intention for the land, the gain on the sale would be classified as

• A)business income.
• B)property income.
• C)a capital gain.
• D)exempt income.

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Definitions:

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