When unrelated parties agree to an exchange of noncash properties, the economic presumption is that the properties have the same adjusted book basis.

Question

Quizplus · Accepted Answer

The economic presumption in an exchange of noncash properties between unrelated parties is that the properties have the same fair market value, not the same adjusted book basis. The adjusted book basis is an accounting measure that may not reflect current market conditions or value.

When Unrelated Parties Agree to an Exchange of Noncash Properties