Tricia's office building,which has an adjusted basis of $220,000,is destroyed by fire on May 5,2010.Insurance proceeds of $425,000 are received on June 1,2010.She has a new office building constructed for $410,000,which she occupies on October 1,2011.Assuming Tricia's objective is to minimize the tax liability,calculate her recognized gain or loss and the basis of the new office building.

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The Answer of Tricia's office building,which has an adjusted basis of $220,000,is destroyed by fire on May 5,2010.Insurance proceeds of $425,000 are received on June 1,2010.She has a new office building constructed for $410,000,which she occupies on October 1,2011.Assuming Tricia's objective is to minimize the tax liability,calculate her recognized gain or loss and the basis of the new office building.

Tricia's Office Building,which Has an Adjusted Basis of $220,000,is Destroyed