During 2002,Trump Corporation Bought a Factory Building for $500,000

question 106

Multiple Choice

During 2002,Trump Corporation bought a factory building for $500,000.It deducted $180,000 of cost recovery deductions using straight-line depreciation while the building was in service.Trump sells the building in 2016 for $500,000.What are the tax consequences of the sale? (Do not consider Trump's other transactions) .

• A)$180,000 Section 1231 gain.
• B)$180,000 unrecaptured Section 1250 gain.
• C)$180,000 recaptured under Section 1245.
• D)$180,000 Section 1250 gain
• E)$ 90,000 Section 1231 income; and $ 90,000 ordinary income, recaptured under Section 1250.

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Definitions:

U.S. Steel

An integrated steel producer with major production operations in the United States and Central Europe.

Billion Dollars

A unit of currency measurement equal to 1,000 million dollars, often used to denote significant economic, corporate, or governmental financial transactions.

Anti-trust Case

Legal proceedings aimed at stopping or regulating companies to prevent monopoly practices and promote competitive markets.

Interstate Commerce

Refers to the purchase, sale or exchange of commodities, transportation of people, money or goods, and navigation of waters between different states.