Exam (elaborations)

REE 4204 Exam Questions With Revised Answers

0 purchase

Course
REE 4204

Institution
REE 4204

REE 4204 Exam Questions With Revised Answers What are the four requirements for tax-deferred exchange? - answer1. it must be like-kind and help for trade, business, or investment (can do farmland to apartments) CANT DO owner- occupied residential (primary residence) 2. help for trade, business...

[Show more]

Preview 2 out of 5 pages

View example

Uploaded on September 8, 2024
Number of pages 5
Written in 2024/2025
Type Exam (elaborations)
Contains Questions & answers

ree 4204 exam questions with revised answers

Institution REE 4204
Course REE 4204

Brightstars Member since 6 months 35 documents sold

$10.49

Add to cart

Save

100% satisfaction guarantee
Immediately available after payment
Both online and in PDF
No strings attached

©THEBRIGHTSTARS 2024

REE 4204 Exam Questions With Revised
Answers

What are the four requirements for tax-deferred exchange? - answer✔✔1. it must be like-kind
and help for trade, business, or investment (can do farmland to apartments) CANT DO owner-
occupied residential (primary residence)

2. help for trade, business, or investment (can do farmland to apartments) CAN'T DO owner-
occupied residential (primary residence)

3. The exchange must occur cant sell for cash and immediately purchase

4. basis acquired for property is equal to the basis of relinquished property

What is the boot? - answer✔✔a term that represents non-like-kind property

e.g if Property A is worth 10 the owner can exchange it for Property worth 8 and 2 in cash

in this example, the 2 in cash is the boot and is a taxable portion of the exchange.

Time limits in tax deferred exchanges - answer✔✔3 requirements

1. replacement property must be identified by the owner of the relinquished property during the
identification period of 45 days ( starts the day the relinquished property is transferred and ends
45 days after)

2. the exchange must happen within the exchange period. (starts the day the relinquished
property is transferred and ends 180 days after)

, ©THEBRIGHTSTARS 2024

3. the owner of the relinquished property must not be in constructive receipt of the proceeds from
the transfer of the property.
In tax-deferred exchanges where real estate is involved,

the tax laws clearly distinguish and prohibit exchanges between different types of real property
such as apartments and office buildings. - answer✔✔False

Exchanges can be made between different types of non-residential properties like apartments and
office buildings, but can not be made between owner-occupied properties.

What is an Installment sale? - answer✔✔it occurs when a seller takes back a promissory note
from the buyer and instead of receiving the full payment of the sale price in the year of the sale
the seller will receive a series of payments (installments) over a specified time

What are the benefits of an installment sale? - answer✔✔by reviving the payments in increments
it lowers (places you in) the marginal tax rate (only going to be taxed on the amount received in
a given year)
In an installment sale the gross profit % is the portion of capital gain that is taxed in each year -
answer✔✔since you only taxed on the gain from the sale this tells you how much of your
payment each year is taxable
The effect of an installment sale is a spreading of the gain and the resulting tax over the period of
the installment sale. - answer✔✔True

Imputed Interest Rule - answer✔✔-Requires a fair interest rate to be charged
-A seller may have an incentive to set an interest rate higher below the market and raise the
contract price to recapture lost interest because (capital gains tax is at a lower tax rate say 15%)
In you installment agreement you are going to have an installment period and debt amortization -
answer✔✔they may be equal but the amort period can be longer than the installment period to
cover debt service cheaper (more affordable)

Related Persons Rule - answer✔✔If an installment sale is made to a related person who sells the
property within a two-year period, the original seller must recognize the balance of the gain at
the time the related person makes the sale.
If the seller makes an installment sale to a related person who sells the property within two years,

The benefits of buying summaries with Stuvia:

Guaranteed quality through customer reviews

Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.

Quick and easy check-out

You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.

Focus on what matters

Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!

Frequently asked questions

What do I get when I buy this document?

You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.

Satisfaction guarantee: how does it work?

Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.

Who am I buying these notes from?

Stuvia is a marketplace, so you are not buying this document from us, but from seller Brightstars. Stuvia facilitates payment to the seller.

Will I be stuck with a subscription?

No, you only buy these notes for $10.49. You're not tied to anything after your purchase.

Can Stuvia be trusted?

4.6 stars on Google & Trustpilot (+1000 reviews)

65539 documents were sold in the last 30 days

Founded in 2010, the go-to place to buy study notes for 15 years now

Start selling

Exam (elaborations)

REE 4204 Exam Questions With Revised Answers

Document information

Subjects

Written for

Seller

Reviews received

Content preview