[Anonymous]

For nonmonetary exchanges without commercial substance and with boot <=25% of FV, you recognize gain up to the portion of the proceeds that are cash. And if you have boot >=25% of FV, you recognize all of the gain. My question is, do you include the cash in the FV calculation?

I.e. you get a truck worth 50,000 and cash worth 10,000 and you’re giving up a truck worth 40,000 CV. Are you calculating if the cash is less than 25% of 50,000 (just the truck’s FV) or 25% of 60,000 (the combined amount of cash plus truck’s FV)?

[Anonymous]

@Determined,

for this calculation cash is not added to F.V.

Recognized gain = Realized gain x (cash received / F.V.)

hth

[Anonymous]

Cool.

[Author]

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