Joe is in the landscaping business. He owns a 20 foot x 20 foot storage garage on a small plat of land which serves as his office and the storage facility for his landscaping equipment. He paid $90,000 for the garage and has claimed $22,000 in depreciation deductions over the 6 years he has been using this garage in his business activities. Joe also owns a wide variety of gas and electric powered landscaping machines which he purchased for $72,000 and has claimed depreciation deductions of $41,000 as of April 1, 2022. On April 1, 2022 Joe sells the garage and land for $130,000 and the landscaping equipment for $47,000.

C. How much gain or loss should Joe report on his 2022 federal income tax return as a result of the sale of the landscaping machines?

D. How much of the gain or loss is reported as

Section 1231 gain or (loss)? ________________________

Long-term capital gain or (loss)? __________________________

Ordinary income or (loss)? _________________________