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Tax treatment for land exchanges

Melissa owns a residential lot in Spring Creek that has appreciated substantially in value. She holds the lot for investment. She is exchanging the lot with her father for a residential lot in McComb that she also will hold for investment. Please identify any relevant tax issues for Melissa.

Solution Preview

Since the lot Melissa owns has appreciated substantially, she would more than likely want to try and get the
exchange to qualify for § 1031 ...

Solution Summary

The solution provides a discussion for land exchanges in investment purposes, and the accounting treatment for the exchange.