Tax Research Problem - Chapter 13

Tax Research Problem - Chapter 13 - Tax Research Problem...

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Unformatted text preview: Tax Research Problem I:13-71 According to the IRS Section 1231 property is depreciable property and real property (e.g. - land) used in a trade or business and held for more than one year. Timber, coal or domestic iron ore, and some types of livestock are also covered. 1231 property does not include: inventory, property held for sale in ordinary course of business, artistic creations held by their creator, government publications. Therefore, the automobiles provided by the Berkeley Corporation to the head basketball coach to use for short periods of time do not qualify as Sec. 1231 property. The automobiles are held primarily for sale to customers in Berkeley's trade or business. Rev. Rul. 75-538 [1975-2 C.B. 34] states: "A taxpayer engaged in the trade or business of selling motor vehicles is presumed to hold all such vehicles primarily for sale to customers in the ordinary course of the taxpayer's trade or business. To overcome this presumption, it must be clearly shown that the motor vehicle was actually devoted to use in the business of the dealer and...
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This note was uploaded on 10/22/2011 for the course ACCOUNTING ACC565 taught by Professor Lindachess during the Spring '10 term at Strayer.

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Tax Research Problem - Chapter 13 - Tax Research Problem...

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