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Flashcards in 14 Taxation Deck (14)
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1

Ad valorem taxes

Real property taxes

2

Basis

-Cost basis is the dollar amount assigned to property at the time of acquisition under provisions of the internal revenue code for the purpose of determining gain, loss, and depreciation in calculating the income tax to be paid on the sale or exchange of the property .

-adjusted cost basis is derived after the application of certain additions, such as improvements, and deductions, such as for depreciation.

3

Capital gain

The amount by which the net resale proceeds of a capital item exceed the adjusted cost basis of the item.

4

Depreciation

-Decrease in value of an asset that is allowed in computing property value for tax purposes.
-In appraising, a loss in the value of a property improvement from any cause
-Depreciation is curable when it can be remedied by a repair or an addition to the property, and it is incurable when there is no easy or economic way to cure the loss

5

Estate

The interest held by the owner of property

6

Reverse exchange

Delayed exchange where the property desired is acquired prior to sale of exchanger’s property.

7

Sale-leaseback

A transaction in which, at the time of sale, the seller retains occupancy by concurrently agreeing to lease the property from the purchaser.

8

Supplemental tax bill

Covers the difference between the seller’s assessed valuation and the new valuation based on the sales price.

9

Proposition 13

-enacted in 1978
-limits annual in valuation to 2 percent

10

Proposition 58

-allows transfers without reassessment to a spouse or children

11

Proposition 60

-Allows homeowners over 55 years of age to transfer their assessed valuation to a new residence in the same county

12

Proposition 90

-Extends Prop 60 to participating counties

13

1031 exchange

Allows for exchange of personal property, as well as real property

14

Boot

Is cash received, unlike property or debt relief