Reference no: EM13577503

1.A retail building used in the trucking business of a sole proprietor is sold on February 10, 2010 for $300,000. It had been acquired in 1992 for $275,000. Straight-line depreciation of $175,000 had been taken on the property. What is the maximum unrecaptured § 1250 gain from this disposition after considering depreciation recapture?

a. $0.

b. $100,000.

c. $175,000.

d. $275,000.

e. None of the above.

2. The HAT Partnership has three corporate partners with taxable years and ownership interests in the venture as follows:

                        Tax Year                       Interest in

Partner             Ending                         Partnership

H Inc.              April 30                                   30%

A Inc.              October 31                              40%

T Inc.               November 30                          30%

a. A partnership must use the calendar year to report its income.

b. The partnership can elect to use a November year end.

c. Under the least aggregate deferral calculations, using a fiscal year ending October 31 will result in an aggregate deferral of .30 (1 X .30) with respect to T and 1.8 (6 X .30) with respect to H.

d. The partnership must use an October 31^st year end since A Inc. has the largest ownership interest.

1. None of the above.

3. Which of the following is not an exception to the accrual method of reporting requirement for corporations?

a. A corporation with average annual gross receipts for the most recent three-year period of $5 million or less.

b. A tax shelter.

c. A farming business.

d. A qualified personal service corporation.

e. None of the above.