hard · Certified Financial Planner Tax Planning

The Calder household exchanges an investment real estate parcel with a fair market value of $1,400,000, an adjusted basis of $420,000, and an outstanding mortgage of $280,000. They receive a replacement property with a fair market value of $1,250,000, and they assume a $210,000 mortgage. To equalize the exchange, the Calders also receive $30,000 in cash and $15,000 in office equipment.

What is the amount of gain recognized by the Calders under Section 1031?

  1. $100,000
  2. $30,000
  3. $115,000
  4. $945,000

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