Depreciation Recapture Does Not Apply to a Transfer Coming Under

question 55

True/False

Depreciation recapture does not apply to a transfer coming under Sec.351 unless the transferor recognizes gain on depreciable property that is transferred.

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Definitions:

Cost Method

An accounting method used to value an investment, based on the cost to acquire it, without considering its fair market value changes.

Voting Shares

Shares that grant the holder the right to vote on corporate matters, typically related to company governance.

Bonds Payable

Long-term liabilities on a company's balance sheet, representing the amount owed to bondholders by the issuer.

Straight Line Amortization

A method of allocating an asset's cost evenly over its useful life.