Which of the Following Satisfy the Time Period Requirement for Postponement

question 59

Multiple Choice

Which of the following satisfy the time period requirement for postponement of gain as a § 1033 (nonrecognition of gain from an involuntary conversion) involuntary conversion?

• A)Al's business warehouse is destroyed by a tornado on October 31, 2012.Al is a calendar year taxpayer.He receives insurance proceeds on December 5, 2012.He reinvests the proceeds in another warehouse to be used in his business on December 29, 2014.
• B)Heather's personal residence is destroyed by fire on October 31, 2012.She is a calendar year taxpayer.She receives insurance proceeds on December 5, 2012.She purchases another principal residence with the proceeds on October 31, 2014.
• C)Mack's office building is condemned by the city as part of a road construction project.The date of the condemnation is October 31, 2012.He is a calendar year taxpayer.He receives condemnation proceeds from the city on that date.He purchases another office building with the proceeds on December 5, 2015.
• D)Lizzy's business automobile is destroyed in an accident on October 31, 2012.Lizzy is a fiscal year taxpayer with the fiscal year ending on June 30th.She receives insurance proceeds on December 5, 2012.She purchases another business automobile with the proceeds on June 1, 2015.
• E)All of the above.

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Definitions:

Strong-form Efficient

A hypothesis suggesting that all information, both public and private, is reflected in a stock's price, making it impossible to consistently achieve higher returns.

Variance

A measure of the dispersion of a set of data points around their mean, often used in finance as a measure of the risk associated with a particular investment.

Average Squared Difference

A statistical measure calculated by averaging the squares of differences from a mean, often used in variance calculations.

Actual Return

The real profit or loss generated on an investment over a specified period, taking into account both capital gains and income received from the investment.