Alomar,a cash basis S corporation in Orlando,Florida,holds the following assets and liabilities on January 1,2015,the date the S election is made. Adjusted Basis Fair Market Value Cash $ 200,000 $ 200,000 Accounts receivable -0- 105,000 Equipment 110,000 100,000 Land 1,800,000 2,500,000 Accounts payable -0- 110,000 During 2015,Alomar collects the accounts receivable and pays the accounts payable.The land is sold for $3 million,and the taxable income for the year is $590,000.Calculate any built-in gains tax.

Question

Alomar,a cash basis S corporation in Orlando,Florida,holds the following assets and liabilities on January 1,2015,the date the S election is made. Adjusted Basis Fair Market Value Cash $ 200,000 $ 200,000 Accounts receivable -0- 105,000 Equipment 110,000 100,000 Land 1,800,000 2,500,000 Accounts payable -0- 110,000 ​ During 2015,Alomar collects the accounts receivable and pays the accounts payable.The land is sold for $3 million,and the taxable income for the year is $590,000.Calculate any built-in gains tax.

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The Answer of Alomar,a cash basis S corporation in Orlando,Florida,holds the following assets and liabilities on January 1,2015,the date the S election is made. Adjusted Basis Fair Market Value Cash $ 200,000 $ 200,000 Accounts receivable -0- 105,000 Equipment 110,000 100,000 Land 1,800,000 2,500,000 Accounts payable -0- 110,000 ​ During 2015,Alomar collects the accounts receivable and pays the accounts payable.The land is sold for $3 million,and the taxable income for the year is $590,000.Calculate any built-in gains tax.

Alomar,a Cash Basis S Corporation in Orlando,Florida,holds the Following Assets