45. Hart, an individual, bought an asset for $500,000 and has claimed $100,000 of depreciation deductions against the asset. Hart has a marginal tax rate of 32 percent. Answer the questions presented in the following alternative scenarios

(assume Hart had no property transactions other than those described in the problem):

a. What is the amount and character of Hart’s recognized gain or loss if the asset is tangible personal property sold for

$450,000? What effect does the sale have on Hart’s tax liability for the year?

b. What is the amount and character of Hart’s recognized gain or loss if the asset is tangible personal property sold for

$550,000? What effect does the sale have on Hart’s tax liability for the year?

c. What is the amount and character of Hart’s recognized gain or loss if the asset is tangible personal property sold for

$350,000? What effect does the sale have on Hart’s tax liability for the year?

d. What is the amount and character of Hart’s recognized gain or loss if the asset is a nonresidential building sold for

$450,000? What effect does the sale have on Hart’s tax liability for the year?

e. Now assume that Hart is a C corporation. What is the amount and character of its recognized gain or loss if the asset is a nonresidential building sold for $450,000? What effect does the sale have on Hart’s tax liability for the year

(assume a 21 percent tax rate)?

f. Assuming that the asset is real property, which entity type should be used to minimize the taxes paid on real estate gains?