Which of the Following Would Extinguish the § 1245 Recapture

question 12

Multiple Choice

Which of the following would extinguish the § 1245 recapture potential?

• A) An exchange of depreciable business equipment for like-kind business equipment with gain realized, but not recognized.
• B) A nontaxable incorporation under § 351.
• C) A nontaxable contribution to a partnership under § 721.
• D) A nontaxable reorganization.
• E) None of the above.

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Definitions:

Process Innovation

The development and use of new or improved production or distribution methods.

Extracting Copper

The process of retrieving copper from its ores using techniques like mining, crushing, and refining.

First Discovery

The initial identification or observation of a phenomenon, principle, or resource, marking a seminal moment in the expansion of knowledge or exploration.

Invention

The creation of a new product, process, or method that has not existed before, often protected by patents.