provide correct answer Jessica and Ryan Green purchased a home in Phoenix, Arizona for $350,000. Theymoved into the home on January 1 of Year 1 and lived there as their primaryresidence until July 1 of Year 1, when they sold the home for $500,000.Assume the Greens sell the home because Jessica's job requires relocation toanother state.How much gain will the Greens recognize on their home sale?

Step 1: Definition of Home Sale ExclusionThe Home Sale Exclusion under IRS Section 121 allows…

Answered: Jessica and Ryan Green purchased a home…

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter12: Nonrecognition Transactions

Section: Chapter Questions

Problem 41P

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The Blacks moved from Maine to Nevada. As a result, they sold their house in Maine on January 4, 2022. They originally paid $80,000 for the home on July 3, 1996, but managed to sell it for $598,000. They spent $14,000 on improvements over the years. How do I fill out the Form 8949?
Your supervisor has asked you to research the following situation concerning Owen and Lisa Cordoncillo. Owen and Lisa are brother and sister. In May 2020, Owen and Lisa exchange land they both held separately for investment. Lisa gives up a 2 acre of property in Texas with an adjusted basis of $2,000 and a fair market value of $6,000. In return for this property, Lisa receives from Owen a 1 acre property in Arkansas with a fair market value of $5,500 and cash of $500. Owen’s adjusted basis in the land he exchanges is $2,500. In March 2021, Owen sells the Texas land to a third party for $5,800. Required: Go to the IRS website. Locate and review Publication 544, Chapter 1, Nontaxable Exchanges. Write a file memorandum stating the amount of Owen and Lisa’s gain recognition for 2020. Also determine the effect, if any, of the subsequent sale in 2021.
Judy’s mother, Sarah, died on July 2, 2018, leaving Judy her entire estate. Included in the estate was Sarah’s residence. Sarah’s basis in the residence was $30,000. The fair market value of the residence on July 2, 2018, was $155,000. The property was distributed to Judy on January 1, 2018. The Vances have held the property as a rental property and have managed it themselves and they started renting the house to the same tenant starting January 1, 2019. To compute depreciation on the house, the Vances had allocated $15,000 of the property’s basis to the land on which the house is located. The Vances collected rent of $1,000 a month during the months the house was rented during the year. They incurred the following related expenses during this period: Property insurance$500, Property taxes $800, Maintenance$465. For 2020, can she deduct qualified business income on form 1040?
Michael and Petunia have lived in a home from 1973 to today. They purchased the home for $180,000 and sold it for $560,000. Assume the couple has not used a section 121 exclusion before. How much will their AGI increase from selling the house?
aniel Jackson bought a home in 2010, before he married his wife Sarah. In 2020, Daniel and Sarah are equired to move due to Sarah’s new position she was offered recently. Daniel bought the home for 250,000 and it is being sold for 700,000 (it has had some upgrades). Daniel is self-employed so this won’tbe a problem for him. Sarah and Daniel were married 8 years ago. During his ownership, Daniel had a home office, where he worked form time to time.As a part of the sale, these are the required known attributes:• Sales Contract Price: 700,000• Expenses of the sale: 57,000• Purchase price: 250,000• Accumulated Depreciation for Home Office: $7500 What is the effect of the home office on the gain calculation?
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On September 30 of last year, Rex received some investment land from Holly as a gift. Holly’s adjusted basis was $50,000 and the land was valued at $40,000 at the time of the gift. Holly acquired the land five years ago. What is the amount and character of Rex’s recognized gain (loss) if he sells the land on May 12 this year at the following prices? (Enter NA if a situation is not applicable. Leave no answer blank. Enter zero if applicable.) a. $32,000 b. $70,000 c. $45,000
Ted Barnes has 100 acres of unimproved land, which he actively farms. Its cost basis is $10,000 but its fair market value on December 31, 2022 appears much higher. Ted trades it to Fred Lawyer for a city apartment building worth $70,000, which has a basis to Fred Lawyer of $30,000. None of the property is mortgaged, and Lawyer claimed straight-line deprecation on the apartment. What is Lawyer’s realized gain and loss on the exchange? What is Lawyer’s recognized gain or loss on the exchange? What is Lawyer’s basis for the farmland acquired?
On September 30 of last year, Rex received some investment land from Holly as a gift. Holly's adjusted basis was $50,000 and the land was valued at $40,000 at the time of the gift. Holly acquired the land five years ago. What are the amount and character of Rex's recognized gain (loss) if he sells the land on May 12 this year at the following prices? (Enter NA if a situation is not applicable. Leave no answer blank. Enter zero if applicable.) b. Land sold for $70,000 Amount
On September 30 of last year, Rex received some investment land from Holly as a gift. Holly's adjusted basis was $50,000 and the land was valued at $40,000 at the time of the gift. Holly acquired the land five years ago. What are the amount and character of Rex's recognized gain (loss) if he sells the land on May 12 this year at the following prices? (Enter NA if a situation is not applicable. Leave no answer blank. Enter zero if applicable.) a. Land sold for $32,000 Amount

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