Which of the following is not true regarding §1239?
A) It only applies to related taxpayers.
B) It only applies to gains on sales of depreciable property.
C) It only applies to gains on sales of non-residential real property.
D) It does not apply to losses.
E) None of these.

Question

Quizplus · Accepted Answer

§1239 applies to gains on sales of both depreciable property and non-residential real property, so B is false. Additionally, it does not only apply to related taxpayers, as it can also apply to sales between unrelated parties where there is a pre-existing plan to sell the property to a related party. While it generally applies to gains, it can also apply to losses in certain situations, so D is also false. Therefore, the only choice that is not true is C, which incorrectly states that it only applies to gains on sales of non-residential real property.

Which of the Following Is Not True Regarding §1239