Linda purchased a cottage in 1984 for $62,000; on February 22, 1994, it was valued at $126,000. On her 1994 tax return, Linda elected to make use of her remaining lifetime capital gains exemption in the amount of $55,000 by recognizing a notional disposition on the cottage. If Linda sells the cottage today for $670,000, how much of a capital gain will Linda realize? O a) $553,000 b) $615,000 c) $526,500 O d) $608,000
Linda purchased a cottage in 1984 for $62,000; on February 22, 1994, it was valued at $126,000. On her 1994 tax return, Linda elected to make use of her remaining lifetime capital gains exemption in the amount of $55,000 by recognizing a notional disposition on the cottage. If Linda sells the cottage today for $670,000, how much of a capital gain will Linda realize? O a) $553,000 b) $615,000 c) $526,500 O d) $608,000
Chapter5: Introduction To Business Expenses
Section: Chapter Questions
Problem 35P
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![Linda purchased a cottage in 1984 for $62,000; on February 22, 1994, it was valued at $126,000.
On her 1994 tax return, Linda elected to make use of her remaining lifetime capital gains exemption
in the amount of $55,000 by recognizing a notional disposition on the cottage. If Linda sells the
cottage today for $670,000, how much of a capital gain will Linda realize?
O a) $553,000
b) $615,000
c) $526,500
d) $608,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fd369e7ff-f96f-42e8-aab0-deaae43617c3%2F0d7747b1-5144-4d75-8c3a-fcb33890e52f%2F18qgidg_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Linda purchased a cottage in 1984 for $62,000; on February 22, 1994, it was valued at $126,000.
On her 1994 tax return, Linda elected to make use of her remaining lifetime capital gains exemption
in the amount of $55,000 by recognizing a notional disposition on the cottage. If Linda sells the
cottage today for $670,000, how much of a capital gain will Linda realize?
O a) $553,000
b) $615,000
c) $526,500
d) $608,000
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