1. For the following like-kind exchange transactions, determine:
The amount of realized gain or loss
The amount of recognized gain or loss
The basis of the land received
| Basis of Land Exchanged | FMV of Boot Received | FMV of Land Received |
| $225,000 | $-0- | $500,000 |
| $465,000 | $140,000 | $550,000 |
| $675,000 | $350,000 | $700,000 |
| $800,000 | $250,000 | $600,000 |
| $1,000,000 | $125,000 | $750,000 |
Computation of the amount of realized gain or loss, amount of
recognized gain or loss and the basis of the land received
:
|
A |
B |
C |
D = B + C |
E = D - A |
F = lower of B or E |
G = E-F |
H = C - G |
|
Basis of Land |
FMV of |
FMV of Land |
Total amount |
Realized gain |
Recognized gain/ (loss) |
Deferred gain/ (loss) |
Basis of the land received |
|
$225,000 |
$-0- |
$500,000 |
$500,000 |
$275,000 |
$-0- |
$275,000 |
$225,000 |
|
$465,000 |
$140,000 |
$550,000 |
$690,000 |
$225,000 |
$140,000 |
$85,000 |
$465,000 |
|
$675,000 |
$350,000 |
$700,000 |
$1,050,000 |
$375,000 |
$350,000 |
$25,000 |
$675,000 |
|
$800,000 |
$250,000 |
$600,000 |
$850,000 |
$50,000 |
$50,000 |
$0 |
$600,000 |
|
$1,000,000 |
$125,000 |
$750,000 |
$875,000 |
Loss realized |
$0 |
($125,000) |
$875,000 |
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