During the current year, Q sold a desk used in her business.The gain realized was $50 and the § 1245 recapture potential was $375.Q has ordinary gain of $50 and § 1231 gain of $325.

Question

Quizplus · Accepted Answer

The entire gain of $50 would be treated as ordinary income under § 1245 to the extent of depreciation recapture, with no § 1231 gain because the recapture potential exceeds the realized gain.

During the Current Year, Q Sold a Desk Used in Her