Alphonso purchased an office building in 2010 for $650,000 and machinery (7-year property) in September of 2015 for $60,000 (assume these were business-use assets, were the only assets purchased during each of these tax years, and that no $179 expense or bonus depreciation was taken). He sells both of these assets in March 2018 for $700,000 and $42,500, respectively. As of 12/31/2017, Alphonso had taken depreciation on the building of $132,659, and depreciation on the machinery of $33,762. During 2018, Alphonso also had a casualty loss on business equipment of ($5,000) and a casualty gain from insurance proceeds on previously stolen business property of $9,000 (ignore depreciation on this asset). Alphonso had the following $1231 gains/losses during the prior 5 years: (Space provided for your work below) 2013: (5,000) 2014: (12,000) 2015: 4,000 2016: (3,000) 2017: 10.000 If Alphonso's only other income/loss during the year are $200,000 of salary income, and a $350,000 short term capital loss from the sale of stock, what is Alphonso's AGI for 2018?

Alphonso purchased an office building in 2010 for $650,000 and machinery (7-year property) in September of 2015 for $60,000 (assume these were business-use assets, were the only assets purchased during each of these tax years, and that no $179 expense or bonus depreciation was taken). He sells both of these assets in March 2018 for $700,000 and $42,500, respectively. As of 12/31/2017, Alphonso had taken depreciation on the building of $132,659, and depreciation on the machinery of $33,762. During 2018, Alphonso also had a casualty loss on business equipment of ($5,000) and a casualty gain from insurance proceeds on previously stolen business property of $9,000 (ignore depreciation on this asset). Alphonso had the following $1231 gains/losses during the prior 5 years: (Space provided for your work below) 2013: (5,000) 2014: (12,000) 2015: 4,000 2016: (3,000) 2017: 10.000 If Alphonso's only other income/loss during the year are $200,000 of salary income, and a $350,000 short term capital loss from the sale of stock, what is Alphonso's AGI for 2018?

SWFT Comprehensive Volume 2019

42nd Edition

ISBN:9780357233306

Author:Maloney

Publisher:Maloney

Chapter14: Property Transactions: Capital Gains And Losses, § 1231, And Recapture Provisions

Section: Chapter Questions

Problem 34CE

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