Albert purchased a tract of land for $140,000 in 2014 when he heard that a new highway was going to be constructed through the property and that the land would soon be worth $200,000. Highway engineers surveyed the property and indicated that he would probably get $180,000. The highway project was abandoned in 2017 and the value of the land fell to $100,000. What is the amount of loss Albert can claim in 2017?
A)$40,000
B)$60,000
C)$80,000
D)$100,000
E)None of the above

Question

Quizplus · Accepted Answer

Albert cannot claim a loss because the loss is not realized. A loss is only recognized for tax purposes when it is realized through a sale or other disposition of the property.

Albert Purchased a Tract of Land for $140,000 in 2014