tax question please help?

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You are personally own a commercial office building containing 8,000,000. They immediately sell € 20,000,000 lease for exactly 40 years to hire a mortgage payment by the buyer (buyer borrowed $ 20 million from a bank to make the purchase). No improvements are made to the building during the rental period. You pay all costs associated with building mitdes. You have the right to the property at any time be acquired by the adoption of the current mortgage and its payment from the buyer all the loan plus a market interest rate the buyer darauf.Der no obligation to compensate you if the building is unusable for any reason. If you recognize a gain on the sale?

2 Comments
  1. Reply
    Charles G
    May 3, 2011 at 7:28 am

    You sold it for 20M, basis is 8M, gain is 12M

    Lease payments could be a deduction in the year they were paid.

    The right to re-acquire the building would also have taxable income value, at its fair market value.

  2. Reply
    Jim M
    May 3, 2011 at 8:11 am

    Yes, you would recognize a gain on the sale of $ 12,000 (i.e., the difference between the proceeds and basis.

    Nothing else you mentioned matters.

    congratulations.

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