All of the Following Taxpayers Can Use the Installment Method

question 11

Multiple Choice

All of the following taxpayers can use the installment method to report gains from the sale of assets except:

• A)A taxpayer who sells a large piece of manufacturing equipment on which he took a Section 179 deduction for the total cost two years ago when purchased.
• B)A taxpayer who sells land he inherited from his father five years ago.
• C)A taxpayer who sells a parcel of land used in his trade or business.
• D)A taxpayer who sells a building used in his trade or business for five years that was depreciated using straight-line depreciation.

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Definitions:

Financial Disclosures

Information provided by a company to its stakeholders about its financial health, performance, and risks, typically found in annual reports and financial statements.

Economic Incentive

A financial or non-financial reward offered to encourage or discourage specific behaviors or actions by individuals or companies.

Raise Capital

The process by which a company or organization generates funds to finance its operations or growth, often through the sale of equity or debt securities.

Economic Incentive

A financial or non-financial reward offered to encourage or discourage certain behaviors or actions within an economy.