Practice question
Under RR7-2003 Section3(g), what does involuntariness of an expropriation or foreclosure sale alone do to asset classification in the hands of the seller?
- It does not itself change the capital or ordinary character
- It always converts all property to capital
- It always converts all property to ordinary
- It removes the property from every tax rule
- It makes the buyer and seller classifications necessarily identical
Legal references
- NIRC RA8424, relevant provisions as amended: https://lawphil.net/statutes/repacts/ra1997/ra_8424_1997.html Section39(A)(1).
- RR7-2003: https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/10/40237 Sections2(b),3(b)–(g).
- RA12214 CMEPA: https://lawphil.net/statutes/repacts/ra2025/ra_12214_2025.html Section9 amending NIRC34(E)(2).
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