Final answer:
The capital loss of the Taxpayer who sells the apartment building is $40,000.
Step-by-step explanation:
The capital loss of a Taxpayer who sells an apartment building for $150,000, that was purchased in 1993 for $200,000 and depreciated by $90,000, can be calculated as follows:
Original cost of the building: $200,000
Depreciation: $90,000
Adjusted basis: $200,000 - $90,000 = $110,000
Selling price: $150,000
Capital loss: Adjusted basis - Selling price = $110,000 - $150,000 = -$40,000
Therefore, the correct answer is B. $40,000.