Rationale for Nonrecognition Includes Which of the Following

question 44

Multiple Choice

Rationale for nonrecognition includes which of the following?
I.A refinement of the realization concept, which postpones recognition of appreciation in value until the taxpayer disposes of a property, or its replacement.
II.Under the Substance-over-form doctrine, new property acquired in a transaction is viewed as a continuation of the original investment.
III.The taxpayer lacks wherewithal to pay the tax on a realized gain because the amount realized on the transaction is reinvested in the replacement asset.
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• A)Only II is correct.
• B)Only I is correct.
• C)II and III are correct.
• D)I, II, and III are correct.
• E)Only III is correct.

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Definitions:

Ionization

The method through which an atom or molecule obtains a positive or negative charge by the addition or removal of electrons.

Substance

material with particular physical characteristics, an important concept in chemistry and physics.

Nuclear Medicine

A medical specialty involving the application of radioactive substances in the diagnosis and treatment of diseases.

Radiopaque Substance

A substance that does not allow X-rays to pass through and appears white or light on an X-ray film, used in medical imaging to highlight structures.