When One Trades Equity in One Property for Equity in a Similar

question 50

Multiple Choice

When one trades equity in one property for equity in a similar property without receiving cash,he or she pays

• A)no income taxes in the year of the exchange.
• B)income taxes at a maximum 27 percent rate.
• C)income taxes at the normal marginal tax rate.
• D)income taxes the year following the exchange.

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Definitions:

Coracoid Process

A small hook-like structure on the lateral edge of the superior anterior portion of the scapula (shoulder blade) involved in muscle attachment.

Styloid Process

A slender, pointed piece of bone just below the ear, attached to ligaments and muscles associated with the tongue and hyoid bone.

Olecranon Fossa

A deep notch on the posterior side of the humerus bone, into which the olecranon process of the ulna fits when the arm is extended.

Lateral Epicondyle

A bony prominence on the outer side of the elbow, to which forearm muscles are attached.