1. Describe the circumstances in which an individual taxpayer with a net §1231 gain will have different portions of the gain taxed at different rates.
2. Rocky and Bullwinkle Partnership sold a parcel of land during the current year and realized a gain of $250,000. Rocky and Bullwinkle did not recognize gain related to the sale of the land on its tax return. Is this possible? Explain how a taxpayer could realize a gain but not recognize it.