Reference no: EM132889415
Question - Leo exchanged an apartment building (which he rented to tenants) for a commercial warehouse. Information is as follows
What Leo Gave:
Apartment building FMV=20,000,000
Leo bought it 5 years ago for 2,000,000, and there was 1,000,000 of accumulated depreciation
Mortgage on building (assumed by buyer) 10,000,000
Furniture and fixtures FMV=10,000 (adjusted basis =10,000)
Cash 1,000,000
What Leo Got:
Commercial warehouse FMV=22,000,000
(buyer had bought for 50,000,000 and there was 1,000,000 of accumulated depreciation)
Mortgage (assumed by Leo) 5,000,000
A car FMV=100,000 (buyer had bought it for 100,000)
Cash 200,000
Required -
What is the realized gain or loss to Leo?
What is the recognized gain or loss to Leo?
What is Leo's basis in the new building?
What is the holding period of the new building for Leo?
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