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    Importance of Like-Kind Exchanges

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    What are like-kind exchanges and why are they important to the world of taxation?

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    A like-kind exchange is an event whereby a taxpayer disposes of an asset and acquires a substantially similar asset without incurring an income tax liability. In general, to meet the definition of a like-kind exchange (a) the asset being sold must be an investment property and can't be a personal residence, (b) the asset being purchased with the proceeds must ...

    Solution Summary

    This solution of 380 words discusses what a like-kind exchange is and why it is important to taxpayers. References used are included.