Question
Albert is the owner of Pavilion Construction Company, operated as a sole proprietorship. In 2022, Albert sold the following business assets: Asset Original Cost Tax
Albert is the owner of Pavilion Construction Company, operated as a sole proprietorship. In 2022, Albert sold the following business assets:
Asset Original Cost Tax Depreciation Amount Realized on Sale
Construction Crane $ 150,000 $ 70,000 $ 165,000
Warehouse 1,250,000 300,000 2,000,000
Albert had no other dispositions during the year, of either business or personal use assets. Assuming Alberts tax rate is 37% on ordinary income and 20% on net capital gains *, please determine his tax liability associated with the above two dispositions.
* (Net Capital Gain refers to the portion of net long-term capital gains taxed at the preferential rates of 0/15/25%).
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started