Practice question
An asset rises in estimated value, but its owner does not sell, exchange, or otherwise realize gain, and no special rule applies. Does the valuation increase alone establish ordinary realized sale gain?
- No, mere appreciation is not itself the stipulated realization event
- Yes, every estimate is a completed sale
- Yes, an appraisal automatically transfers title
- Yes, ownership must end whenever value changes
- Yes, no transaction analysis is needed
Legal references
- https://lawphil.net/statutes/repacts/ra1997/ra_8424_1997.html — NIRC, section 40(A)–(C)
- https://lawphil.net/statutes/repacts/ra2021/ra_11534_2021.html — RA 11534, section 10 amending NIRC section 40(C)(2)
- https://lawphil.net/statutes/repacts/ra2025/ra_12214_2025.html — RA 12214, section 8 amending NIRC section 32(A)(1)
Answer this question in flashcards to review your response and continue practicing.