Asked by Bruno Freitas on Jun 26, 2024
Verified
Any Section 1245 gain is recognized as "ordinary" to the extent of the depreciation taken.
Section 1245
A provision of the Internal Revenue Code relating to the recapture of depreciation on certain types of property when sold.
Ordinary
Pertaining to regular or usual conditions, occurrences, or business activities that are not exceptional.
- Expound on how gains and losses are treated under Section 1231 in multiple contexts.
Verified Answer
AF
Ashlee FendallJun 30, 2024
Final Answer :
True
Explanation :
This is correct, Section 1245 gain relates to personal property used in trade or business and is subject to depreciation recapture rules. Any gain recognized is treated as ordinary income to the extent of the depreciation taken on the property.
Learning Objectives
- Expound on how gains and losses are treated under Section 1231 in multiple contexts.
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