Tricia's Office Building,which Has an Adjusted Basis of $220,000,is Destroyed

Essay

Tricia's office building,which has an adjusted basis of $220,000,is destroyed by fire on May 5,2010.Insurance proceeds of $425,000 are received on June 1,2010.She has a new office building constructed for $410,000,which she occupies on October 1,2011.Assuming Tricia's objective is to minimize the tax liability,calculate her recognized gain or loss and the basis of the new office building.