Section 1031 like-kind exchanges allow:

A Tax-free exchange of any property

B Deferral of gain on exchange of qualifying real property held for business or investment

C Immediate tax deduction

D Exchanges of personal property

✓ Correct Answer: Option B

§1031: defer gain recognition on exchanges of like-kind real property used in trade/business or held for investment. Personal property no longer qualifies after TCJA.

💡 Why is B) the correct answer?

The correct answer to the question "Section 1031 like-kind exchanges allow:" is Option B: Deferral of gain on exchange of qualifying real property held for business or investment.

The other options — A) Tax-free exchange of any property, C) Immediate tax deduction, D) Exchanges of personal property — are incorrect for this CPA Exam Prep question. As explained above: §1031: defer gain recognition on exchanges of like-kind real property used in trade/business or held for investment. Personal property no longer qualifies after TCJA.

📚 About This CPA Exam Prep Practice Question

This 2-level CPA Exam Prep question from the Regulation (REG) topic is part of BrainForge Quiz's free exam preparation library. Each question includes the correct answer and a detailed explanation to help you understand the underlying concept, not just memorize the answer.

How to use this page: Read the question above, consider all four options (A through D), then check the highlighted correct answer and explanation. For active timed practice, start a free CPA Exam Prep practice test or use flashcards for spaced repetition review.

Practice CPA Exam Prep Quizzes → Browse All Questions Study Flashcards

Section 1031 like-kind exchanges allow:

✓ Correct Answer: Option B

📚 About This CPA Exam Prep Practice Question

Related CPA Exam Prep Questions