Answer the following statements true (T) or false (F)
1. A sole proprietor exchanges an office building used in her business for undeveloped land she plans to hold for investment purposes. The exchange will qualify as like-kind.
2. Real property exchanged for personal property, both held for productive use in a business, qualifies as a like-kind exchange.
3. An investor exchanges an office building located in Niagara Falls, NY, for an office building located in Niagara Falls, Ontario. The exchange does not qualify as like-kind
4. A sale of property and subsequent purchase of like-kind property may be treated as a like-kind exchange if the two transactions are interdependent.
5. For purposes of nontaxable exchanges, cash and non-like-kind property constitute boot.
1. TRUE
Exchanges of real property qualify even if the properties are dissimilar as long as the properties are held for investment purposes or used in a business.
2. FALSE
Only exchanges of real property held for either business or investment use qualify as like-kind.
3. TRUE
Transfers of real property in the United States for real property outside the United States are not like-kind.
4. TRUE
The tax law does allow for a three-party exchange if structured properly.
5. TRUE
The addition of cash or non-like-kind property is needed when the qualifying like-kind properties being exchanged are not of equal value. Any cash or other property which is not like-kind is
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a. True b. False Indicate whether the statement is true or false
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