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Virginia Corporation is a calendar-year corporation. At the beginning of 2019, its election to be taxed as an Scorporation became effective. Virginia Corp's balance sheet
Virginia Corporation is a calendar-year corporation. At the beginning of 2019, its election to be taxed as an Scorporation became effective. Virginia Corp's balance sheet at the end of 2018 reflected the following assets (it did not have any earnings and profits from its prior years as a C corporation). Asset Cash Accounts receivable Inventory Land Totals Adjusted Basis FMV $ 22,500 $ 22,500 43,000 43,000 95,500 210,500 170,000 197,000 $331,000 $473,000 In 2019, Virginia Corp. reported business income of $55,000 (this would have been its taxable income if it were still a C corporation) a. During 2019, Virginia Corp. sold inventory it owned at the beginning of the year for $106,500. The basis of the inventory sold was $59,500. What is Virginia's built-in gains tax on the sale of the inventory in 2019? Built-in gains tax
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