Sarah exchanges a building and land (used in her business) for Tyler's land and building and some equipment (used in his business). The assets have the following characteristics:   Adjusted Basis Fair Market Value Sarah’s real property $120,000     $300,000     Tyler’s real property 60,000     220,000     Equipment 50,000     80,000     a.  What are Sarah’s recognized gain or loss and basis for the land and building and equipment acquired from Tyler? b.  What are Tyler’s recognized gain or loss and basis for the land and building acquired from Sarah?

SWFT Comprehensive Volume 2019
42nd Edition
ISBN:9780357233306
Author:Maloney
Publisher:Maloney
Chapter13: Property Transactions: Determination Of Gain Or Loss, Basis Considerations, And Nonta Xable Exchanges
Section: Chapter Questions
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Sarah exchanges a building and land (used in her business) for Tyler's land and building and some equipment (used in his business). The assets have the following characteristics:

  Adjusted Basis Fair Market Value
Sarah’s real property $120,000     $300,000    
Tyler’s real property 60,000     220,000    
Equipment 50,000     80,000    

a.  What are Sarah’s recognized gain or loss and basis for the land and building and equipment acquired from Tyler?

b.  What are Tyler’s recognized gain or loss and basis for the land and building acquired from Sarah? 

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