Jacqueline Dies While Owning a Building with a $1,000,000 FMV

question 111

Essay

Jacqueline dies while owning a building with a $1,000,000 FMV.The building is classified as Sec.1245 property acquired in 1985 for $850,000.Cost-recovery deductions of $850,000 have been claimed.Pam inherits the property.
a.What is the amount of Pam's basis in the property?
b.What is the amount of cost-recovery deductions that Pam must recover if she immediately sells the building?

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Definitions:

Auditory Tube

Also called the eustachian tube; connects the middle ear to the nasopharynx for the equalization of pressure.

Optic Chiasma

A structure in the brain where the optic nerves (II) partially cross, involved in the visual system.

Visual Field

The entire area that can be seen when the eyes are directed forward, including what can be seen peripherally.

Optic Tracts

Nerve pathways traveling from the optic chiasma to the thalamus in the brain, important for the transmission of visual information.