A retail building used in the business of a sole proprietor is sold on March 10,2014,for $342,000.The building was acquired in 2004 for $400,000 and straight-line depreciation of $104,000 had been taken on the building.What is the maximum unrecaptured § 1250 gain from the disposition of this building?
A)$400,000
B)$322,000
C)$104,000
D)$26,000
E)None of these

Question

Quizplus · Accepted Answer

The maximum unrecaptured § 1250 gain is the $104,000 depreciation taken.That maximum is reduced to the $46,000 gain from the disposition [$342,000 sale price - ($400,000 cost - $104,000 depreciation taken)].

A Retail Building Used in the Business of a Sole