Under the Like-Kind Exchange Rules, When Like-Kind Property Is Traded

Multiple Choice

Under the like-kind exchange rules, when like-kind property is traded for like-kind property, a loss on a trade-in is:

A) recognized and treated as a capital loss.
B) recognized and treated as an ordinary loss.
C) not recognized and increases the basis of the replacement property.
D) not recognized and decreases the basis of the replacement property.
E) none of the above.