Enrolled Agent Exam [Part 2] 48, Section 1231 — Sale of Business Property

This podcast is made by Ran Chen, who holds an EA license, Insurance and Securities licenses (Series 6, 63, 65), and the CFP® designation. He is passionate about opening access to high-quality exam preparation resources and helping learners prepare more effectively for professional certification exams. In this episode you will learn: - That net Section 1231 gains are treated as long-term capital gains, while net losses are treated as fully deductible ordinary losses. - How to correctly net gains and losses from the sale of multiple Section 1231 properties to determine the final tax character. - The function of the five-year lookback rule, which recharacterizes current Section 1231 gains as ordinary income to the extent of unrecaptured Section 1231 losses from the prior five years. - That property must be used in a trade or business and held for more than one year to qualify for Section 1231 treatment. - That depreciation recapture under Sections 1245 and 1250 must be calculated *before* determining the amount of a Section 1231 gain. For more free exam prep tools, practice questions, and AI-powered explanations, visit https://open-exam-prep.com/ or YouTube Channel: https://www.youtube.com/@Open-exam-prep