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CH9_Presentation - Chapter 9 Acquisitions of Property...

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Chapter 9 Acquisitions of Property
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9-2 Preview of Coming Attractions Chapter 9 begins four chapters dealing with property Acquisition (Chapter 9) Depreciation (Chapter 10) Disposition (Chapter 11) Special Issues (Chapter 12)
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9-3 Tax Definition of Property The term property refers to long-lived assets owned by a taxpayer. The amount invested in an asset is the property’s basis .
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9-4 Under the capital recovery concept , a property’s basis may be recovered before any taxable income is realized from disposal of property. Concept Review
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9-5 Classes of Property Property is classified by both its use and its type .
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9-6 Use of Property Property is used for Trade or business, Production of income (investment), or Personal purposes The same property may be used differently by different taxpayers
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9-7 Types of Property All property may be classified by type as either tangible or intangible Intangible property lacks physical substance and has only an economic existence Tangible property has physical substance Tangible real property (realty) consists of land and structures permanently attached to land Tangible personal property (personalty) is all other tangible property
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9-8 Property Investment Cycle Property Acquisition Property Disposition Period of Use Initial Basis Adjusted Basis plus additional capital minus capital recoveries
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Increases in Basis There are two broad categories of increases Additional capital investments Capital expenditures Costs of defending ownership
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This note was uploaded on 02/20/2009 for the course H ADM 422 taught by Professor Lhensley during the Fall '08 term at Cornell.

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CH9_Presentation - Chapter 9 Acquisitions of Property...

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