When Does Unrecaptured §1250 Gains Apply

question 107

Multiple Choice

When does unrecaptured §1250 gains apply?

• A) When the taxpayer makes the election.
• B) It applies only when non-corporate taxpayers sell depreciable real property at a gain.
• C) It applies when §1245 recapture trumps §1250 recapture.
• D) It applies only when real property purchased before 1986 is sold at a gain.
• E) None of these.

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Definitions:

Opportunity Cost

The significance of the most valuable opportunity sacrificed because of a decision made.

Average Total Cost

The cost of producing each unit, calculated by dividing the overall production expenses by the number of products made.

Marginal Cost

The added cost resulting from the manufacture of one more unit of a product or service.

Variable Input

A factor of production whose quantity can be changed easily and flexibly by a firm in the short run to adjust output levels.