The Tax Basis in Property Received in a Like-Kind Exchange

question 1

Multiple Choice

The tax basis in property received in a like-kind exchange in which no gain or loss is recognized is a:

• A)FMV basis
• B)Cost basis
• C)Substituted basis
• D)Carryover basis

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Definitions:

Tax Purposes

The consideration or treatment of transactions, events, or financial situations in relation to calculating tax liabilities.

Dividends

Payments made by a corporation to its shareholder members from the company's earnings.

Earnings

Income generated from a company's business activities over a certain period, often reported as net income.

Face Value

The nominal value or dollar value of a security stated by the issuer.