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AJ, I guess I'm now going to reveal why I did so poorly in accounting... your explanation was way over my head.

What the example boiled down to (in my apparently muddled thinking) is that the poster was saying the equivalent of "unsold inventory = taxable income".

If that were true, then each home buyer would record the sales price of the home as income the year of its purchase. After all, you know you're going to sell the home later, right? So if you haven't sold it, it's "unsold inventory".

What am I missing?
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