Theta corporation formed 15 years ago. In its first year, it elected to use the cash method of accounting and adopted a calendar year as it tax year. It made an S election on August 15 of last year, effective for theta's current tax year.. At the beginning of the current of the current year, Theta had assets with a $600,000 FMV and a $180,000 adjusted basis. During the current year, Theta reports taxable income of $400,000.

In the current year, Theta collects all $200,000 of accounts receivables on outstanding on January 1 of the current year. The receivables had a zero adjusted basis.

On February 1, Theta sells an automobile for $3,500. The automobile had a $2,000 adjusted basis and a $3,000 FMV on January 1 of the current year. Theta claimed $800 of MACRS depreciation on the automobile in the current year.

On March 1, Theta sells land ( a sec 1231 asset) that it held for three years in anticipation of buliding its own office building for a $35,000 gain. The land had a $45,000 FMV and a $25,000 adjusted basis on January 1 of the current year.

In the current year, Theta paid $125,000 of accounts payable outstanding on January 1 of the current year. All the payables are deductible expenses.

What is the amount of Theta's bulit-in-gains tax liabilty.

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