A gain or loss is treated as long-term if the capital asset is held for:

a.

one year or more

b.

more than one year

c.

18 months or more

d.

more than 18 months

Jackson, Inc. sells a piece of machinery for $12,000. The machinery was originally purchased four years ago for $25,000 and the company has claimed depreciation deductions totaling $18,000, making the adjusted basis $7,000 at the time of sale. How much, if any, of the gain is subject to depreciation recapture as Section 1245 gain?

	a.	$0
	b.	$5,000
	c.	$7,000
	d.	$12,000