In a nontaxable exchange, the replacement property is assigned a carryover basis.

Name: In a nontaxable exchange, the replacement property is assigned a carryover basis.
Brand: Quizplus
Rating: 4.8 (29 reviews)

Question

Quizplus · Accepted Answer

In a nontaxable exchange, also known as a like-kind exchange, the replacement property is assigned a carryover basis, which means its basis is equal to the basis of the property that was exchanged. This allows the taxpayer to defer paying taxes on the gain from the sale of the original property until a later date.

In a Nontaxable Exchange, the Replacement Property Is Assigned a Carryover