Cassie owns a Rembrandt painting she acquired on June 1,2008 as an investment.She exchanges the painting on September 5,2014,for a Picasso sculpture and marketable securities to be held as an investment.On what date does the sculpture's holding period begin?
A)June 1,2008
B)June 2,2008
C)September 5,2014
D)September 6,2014

Question

Quizplus · Accepted Answer

The holding period for the Picasso sculpture begins on June 1, 2008, the date Cassie acquired the Rembrandt painting, because the exchange is considered a like-kind exchange under IRS rules, allowing the holding period to tack on from the original asset.

Cassie Owns a Rembrandt Painting She Acquired on June 1,2008