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Orange Inc. was a regular C corporation that made an election to be taxed as an S-corporation that was effective on 1/1/17. At that time,
Orange Inc. was a regular C corporation that made an election to be taxed as an S-corporation that was effective on 1/1/17. At that time, Orange owned the following assets:
| Fair Market Value | Adjusted Basis | App (Dep) | |
| Asset 1 | 150,000 | 125,000 | 25,000 |
| Asset 2 | 200,000 | 230,000 | (30,000) |
| Asset 3 | 200,000 | 100,000 | 100,000 |
During 2019, Orange sold Asset 3 for $225,000. Complete the following:
| What is the net built-in gain on 1/1/17? | |
| What is the total recognized gain recognized in 2019? | |
| What is the recognized built-in gain in 2019? | |
| What is Orange's built-in gain tax liability? | |
| What is the amount of gain that will pass through? |
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