Question

Which of the following statements is false? A. The apportionment of basis must reflect differences in relative fair market values of parcels being sold if such differences exist. B. Equitable apportionment means ratable apportionment on a pro-rata basis. C. Th ere is an opportunity for tax planning in basis apportionment. D.The Tax Court has held that the allocation of basis must be made at the time of purchase rather than att he time of sale.

Answer 1

Answer : Option B

Option B is false because in the option b it is given that equitable apportionment means ratable apportionment but equitable apportionment is not ratable apportionment.The apportionment of basis must reflect differences in relative fair market values of parcels being sold if such differences exist.Ofcourse when there is no difference in the value then it can be apportioned on the prorata basis.Therefore option b is false in the given statements,because it is given that equitable apportionment means ratable apportionment.