Joyce, a Farmer, Has the Following Events Occur During the Tax

question 1

Multiple Choice

Joyce, a farmer, has the following events occur during the tax year.Which of the events qualify as an involuntary conversion under § 1033 (nonrecognition of gain from an involuntary conversion) ?

• A)Her farm tractor is hauled to the city dump because it is worn out.
• B)She burns her barn because it is infested with termites.
• C)Her personal residence, adjusted basis of $100,000, is condemned to make way for an interstate highway.She recovers condemnation proceeds of $175,000.
• D)She sells 10 acres of pasture land at a loss of $40,000 because she has reduced the size of her dairy herd due to a reduction in milk prices.
• E)None of the above.