I:12-31 Like-Kind Exchange: Liabilities. Carol owns land used in her business with a basis of $70,000 and

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I:12-31 Like-Kind Exchange: Liabilities. Carol owns land used in her business with a basis of $70,000 and a fair market value of $90,000. She is planning to exchange the land for a warehouse owned by Jeff and used in his business. Jeff’s warehouse has a basis of

$50,000 and a fair market value of $110,000. The warehouse is also subject to a liability of $20,000. Carol has agreed to assume the liability for Jeff. What is Jeff’s recognized gain and his basis in the new land?

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