The state condemned Cassidy's land on November 25, 2015. The land has a $400,000 basis. Cassidy received insurance proceeds of $610,000 on January 27, 2016. Cassidy has until what date to defer the gain under the involuntary conversion rules?

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Quizplus · Accepted Answer

Under the involuntary conversion rules, Cassidy has three years from the end of the tax year in which the gain is realized to replace the property and defer the gain. Since the gain was realized in 2016, Cassidy has until December 31, 2019.

The State Condemned Cassidy's Land on November 25, 2015