What is the total tax due upon sale

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Question - A developer is selling a project for $15,000,000 with an adjusted basis of $12,500,000. Of the total gain on sale, $1,500,000 is attributable to accumulated depreciation, while the remainder is attributable to a capital gain from appreciation. Assuming a 25% tax rate for recaptured depreciation and a 20% rate for capital gains, what is the total tax due upon sale?

a. $625,000

b. $200,000

c. $500,000

d. $575,000

e. $590,000

Reference no: EM133076861

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