Which of the following statements regarding involuntary conversions is incorrect?
A. The taxpayer-use test applies to the involuntary conversion of rental property owned by an investor.
B. Real property used in a trade or business that is condemned must be replaced with property which has the same functional use as the converted property.
C. The functional-use test is more restrictive than the like-kind test.
D. With some exceptions, the replacement property must be similar or related in service or use to the property converted.
Answer: B
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