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please explain 11. Tito purchased a building in 2014 that he uses in his business. Tito uses the straight-line method for the building. Tito's original
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11. Tito purchased a building in 2014 that he uses in his business. Tito uses the straight-line method for the building. Tito's original cost for the building is $650,000 and cost-recovery deductions are $125,000. Eric is in the top tax bracket and has never sold any other business assets. If the building is sold for $750,000, the tax results are A) $225,000 Sec. 1231 gain, all taxable at 20%. B) $225,000 unrecaptured Sec. 1250 gain, all taxable at 25%. C) $100,000 Sec. 1245 ordinary income, $125,000 Sec. 1231 gain taxable at 20%. D) $225,000 Sec. 1231 gain, of which $100,000 is unrecaptured Sec. 1250 gain taxable at 25% and the $125,000 balance is taxable at 20% Step by Step Solution
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