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Depreciation recapture in the USA is governed by sections 1245 and 1250 of the Internal Revenue Code (IRC). Any gain over the recomputed basis will be taxed as a capital gain in accordance with section 1231 of the IRC. Other countries have similar procedures. In the UK, HMRC uses "negative depreciation".
Although it is not used in the Internal Revenue Code, the term "boot" is commonly used in discussing the tax implications of a 1031 exchange. Boot is an old English term meaning "something given in addition to." "Boot received" is the money or fair market value of "other property" received by the taxpayer in an exchange.
This provision is said to give a taxpayer the "best of both worlds" as it allows the favorable capital gains tax rate on section 1231 property while avoiding the negative implications of capital loss treatment. Ordinary losses are 100% deductible, while capital losses are subject to an annual deduction limitation of $3,000 against ordinary income.
The asset base for the insolvency exemption includes tax-advantaged retirement accounts, almost all types of which are excluded by law from the asset base in bankruptcy. [27] The asset base for the insolvency exclusion also includes assets that serve as collateral for any debt carried by the taxpayer.
Generally speaking, the mere receipt of a benefit from another is unobjectionable and does not attract legal consequences. The exception is where such receipt is "unjust" or "unjustified". Both civil and common law legal systems have bodies of law providing remedies to reverse such enrichment.
The $600,000 estate tax exemption was to increase gradually to $1 million by the year 2006. As inherited assets are automatically revalued to their current or "stepped-up" basis, any capital gains are permanently exempted from taxation. Family farms and small businesses could qualify for an exemption of $1.3 million, effective 1998. Starting in ...
(The Center Square) – Gun owners in Ohio won’t have to worry about firearm purchases being tracked by financial institutions or having to carry liability insurance. Senate Bill 58, one of a ...
Tax capital accounts are partners' "Outside Basis" (however, unlike outside basis, the partnership's recourse and nonrecourse liabilities are not included in partners' tax-basis capital accounts) and under Section 722 are initially determined by reference to the partner's contributed cash amount and the adjusted basis of the contributed property.