A warehouse owned by Greg Bell, a calendar-year taxpayer, was destroyed by fire on February 15, 2013. Bell received a check from his insurance company in full settlement of his claim on April 19, 2014. In order to qualify for nonrecognition of gain on this involuntary conversion, what is the latest date for Bell to acquire qualified replacement property?
A. December 31, 2016
B. April 19, 2016
C. February 15, 2015
D. December 31, 2015
Answer:A
A is corrent. For destroyed, damaged, or stolen property, the replacement period ends 2 years after the close of the taxable year in which the gain is first realized. Since the gain was realized during calendar-year 2014, the replacement period ends December 31, 2016.
B is incorrect.  The replacement period is measured from the year in which gain was first realized.
C is incorrect.  The replacement period ends on the last day of a tax year.
D is incorrect.  The replacement period is longer than 12 months after the year in which gain was realized.