Which of the Following Statements Is Correct with Respect to Qualified

question 94

Multiple Choice

Which of the following statements is correct with respect to qualified replacement property in a § 1033 involuntary conversion?

• A) If the functional use test applies, a warehouse used to store inventory can be replaced with a smaller building to be used to sell inventory.
• B) If the taxpayer use test applies, an office building rented to tenants can be replaced with an office building to be used in the taxpayer's business.
• C) If the like-kind exchange test applies, a building used by the taxpayer for manufacturing can be replaced with an office building to be used in the taxpayer's business.
• D) Only b. and c.
• E) a., b., and c.

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