Albert is in the 35% marginal tax bracket. He sold a building in the current year for $450,000. Albert received
$110,000 cash at closing, the buyer assumed Albert's mortgage for $120,000, and the buyer gave Albert a 6% note for $220,000 due in two years. The Federal rate was 6%. Albert's basis in the building was $180,000 ($500,000 cost - $320,000 accumulated straightline depreciation). Assuming he did not elect out of the installment method, Albert's § 1231 gain and gain taxed at the 25% rate in the year of sale are what amounts?
$\begin{array} { l l }
\text { Section } 1231 \text { Gain } & \text { Unrecaptured } \S 1250 \text { Gain Taxed at } 25 \% \\end{array}$

Question

Albert is in the 35% marginal tax bracket. He sold a building in the current year for $450,000. Albert received
$110,000 cash at closing, the buyer assumed Albert's mortgage for $120,000, and the buyer gave Albert a 6% note for $220,000 due in two years. The Federal rate was 6%. Albert's basis in the building was $180,000 ($500,000 cost - $320,000 accumulated straight­line depreciation). Assuming he did not elect out of the installment method, Albert's § 1231 gain and gain taxed at the 25% rate in the year of sale are what amounts?
$\begin{array} { l l } 
\text { Section } 1231 \text { Gain } & \text { Unrecaptured } \S 1250 \text { Gain Taxed at } 25 \% \\end{array}$

Quizplus · Accepted Answer

The Answer of Albert is in the 35% marginal tax bracket. He sold a building in the current year for $450,000. Albert received
$110,000 cash at closing, the buyer assumed Albert's mortgage for $120,000, and the buyer gave Albert a 6% note for $220,000 due in two years. The Federal rate was 6%. Albert's basis in the building was $180,000 ($500,000 cost - $320,000 accumulated straight­line depreciation). Assuming he did not elect out of the installment method, Albert's § 1231 gain and gain taxed at the 25% rate in the year of sale are what amounts?
$\begin{array} { l l } 
\text { Section } 1231 \text { Gain } & \text { Unrecaptured } \S 1250 \text { Gain Taxed at } 25 \% \\end{array}$

Albert Is in the 35% Marginal Tax Bracket Section 1231 Gain Unrecaptured §1250 Gain Taxed at 25%\begin{array} { l l } \text { Section } 1231 \text { Gain } & \text { Unrecaptured } \S 1250 \text { Gain Taxed at } 25 \% \\\end{array} Section 1231 Gain ​ Unrecaptured §1250 Gain Taxed at 25%​

Albert Is in the 35% Marginal Tax Bracket $\begin{array} { l l } \text { Section } 1231 \text { Gain } & \text { Unrecaptured } \S 1250 \text { Gain Taxed at } 25 \% \\\end{array}$