Check my work 1 Required information [The following information applies to the q
ID: 2508784 • Letter: C
Question
Check my work 1 Required information [The following information applies to the questions displayed below.] Part 1 of 5 Hart, an individual, bought an asset for $500,000 and has claimed $100,000 of depreciation deductions against the asset. Hart has a marginal tax rate of 30 percent. eBook Answer the questions presented in the following alternative scenarios (assume Hart had no property transactions other than those described in the problem): (Loss amounts should be indicated by a minus sign. Enter NA if a situation is not applicable. Leave no answer blank. Enter zero if applicable.) Print a-1. What is the amount and character of Hart's recognized gain if the asset is tangible personal property sold for $450,000? Description Amount Total Gain/(Loss) Recognized Ordinary Income 81245 depreciation recapture $1231 gainñossExplanation / Answer
Answer
A1
Amount realised =450000
Original Value=500000
Actual Depreciation=100000
Actual Value=OV-AD
500000-100000=400000
Gain or loss Recognised=AR-AV
450000-400000=50000
Ordinary Income=AD-G/L recog
100000-50000=50000
1231 Gain=G/L recog-OI
50000-50000=0
Ans B1
AnsC1
AnsC2
Tax Liability
-50000*30%=-15000
Tax Savings=-15000
Ans D1
Ans D2
Tax Liability 25%of unrecaptured
50000*25%=12500
Ans E1
Description Amount Total Gain/Loss recognized 50000 Ordinary Income -1245depreciation recapture 50000 1231gain/loss 0