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Capital Assets
Richard-67981 - 09/2/2018, 3:19 pm

I've always viewed buildings and equipment owned by a cop oration as capital assets. The answer to a review question on this topic stars that capital assets are limited to investments in stocks and bonds and land purchased for appreciation. Any thoughts?

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RAIN - 09/2/2018, 9:12 pm

Property used in a trade or business is NOT a capital asset, it is generally §1231 property (and also subject to §1245 or §1250).
See 26 U.S. Code § 1221. It defines what is NOT a capital asset, and has the highest authority.

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liamkshaw68 - 08/7/2019, 9:16 pm

It's one of those questions designed at fooling you into answering incorrectly. In the real world, many if not most people refer to fixed assets as capital assets. I think of them that way - in fact, I have found it's rare to deal with a corporation that holds stocks and bonds. While technically the explanation of the answer is correct, it's still a question designed to mislead, in my opinion.

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