Sean sells land to Eli, his brother, for the fair market value of $39,000. Six months later when the land is worth $45,000, Eli sells the property to his son, Jon, without gift tax. His son sells the land for $47,000. Sean’s adjusted basis for the land is $24,000 what is Jon’s recognized gain or loss on the sales?

Q: Dave is terminally ill and does not expect to live much longer.  Pondering the consequences of his…

A: Gift tax: It is the amount of tax payable by an individual who transfers something to any other…

Q: Linda purchased a cottage in 1984 for $62,000; on February 22, 1994, it was valued at $126,000. On…

A: The profit made on the sale of an asset such as stocks, bonds, or real estate is referred to as…

Q: Olivia wants to buy some vacant land for investment purposes. She cannot afford the full purchase…

A: Capital gain refers to an amount that an individual or corporation earns after selling an asset…

Q: Bob owned a duplex used as rental property.  The duplex had an adjusted basis to Bob of $86,000 and…

A: Given information:   Fair Market Value - $300,000 The sale price of the duplex - $312000

Q: Frances and George sold their principal residence for $1,000,000. They purchased the home 10 years…

A: Total cost to be allowed as deductible for capital gain purpose is Purchase cost            =…

Q: Steve and Stephanie Pratt purchased a home in Spokane, Washington, for $400,000. They moved into the…

A: When an investment, such as a stock, that has been held for less than a year is sold, a short-term…

Q: Lisa sells business property with an adjusted basis of $168,800 to her son, Alfred, for its fair…

A: As Lisa sold the property to a related party (her son), Lisa's realized loss of $33,760 ( $135,040 -…

Q: .  Bob owned a duplex used as rental property.  The duplex had an adjusted basis to Bob of $86,000…

A: Given information:   Adjusted basis - $279,000 Fair Market Value - $300,000

Q: Florence purchased stock 4 years ago for $20,000. Last year she gifted the stock to her son when the…

A: The cost basis to Florence son is the fair market value of $15,000

Q: Just prior to a major medical procedure, Cody gives his son, Liam, stock in Robin corporation (fair…

A: A) if any property  is transferred  by way of gift the cost of acquisition of property  is the…

Q: Laurie has owned and occupied her personal residence (adjusted basis $190,000) for 4 years. In April…

A: Realized gain refers to the excess of sales proceeds over the net cost of the asset. Net costs…

Q: in her current - year gross income. Which of the following form(s) the basis for this treatment? I.…

A: I. Capital Recovery Concept: No income is realized until the amount invested has been recovered.The…

Q: Olivia wishes to purchase some undeveloped land for investment purposes. She is unable to pay the…

A: An funding is usually the outlay of a few capital today—time, effort, money, or an asset—withinside…

Q: .  What is Donna's charitable contribution deduction? The stock is treated as ordinary income…

A: Charitable contribution: Charitable contribution can be defined as donation made to any non-profit…

Q: Liam has always been a photo enthusiast. In 2021, a local gallery owner saw some of his photographs…

A: A tax return is a document that individuals, businesses, or other entities file with the tax…

Q: Dave receives a duplex as a gift from his uncle. The uncle's basis for the duplex and land is…

A: The tax basis represents the original cost of the property plus certain additional costs. When…

Q: When Barry’s grandmother passed away, she gave Barry a diamond ring that was worth $6,000 at the…

A: The objective of this question is to determine Barry's basis in the diamond ring under different…

Q: Marci purchased her home seven years ago for $175,000. She sold it at a loss for $150,000 in 2022.…

A: In general, losses on the sale of personal residences are not tax-deductible. The sale of a personal…

Q: Calculate Karen’s realized and recognized gain or loss, and (2) explain

A:

Q: a. What is Lisa's realized and recognized gain or loss? is recognized. b. What is Alfred's…

A: Lisa sold the property to related party (her son). Lisa realised loss of $27,780 ($111,120-1,38,900)…

Q: Jarrod receives a scholarship of $28,000 from East State University to be used to pursue a…

A: As per the law, "Gross income" is the income of an individual person which is an amount earned by a…

Q: Three years ago, Adrian purchased 100 shares of stock in X Corporation for $10,000. On December 30…

A: Introduction:- The loss must not be covered by insurance and must have occurred during the tax year…

Q: Olivia wants to buy some vacant land for investment purposes. She cannot afford the full purchase…

A: The purchase of option is treated as a capital asset

Q: ack purchases a house for $90,000 and spends $15,000 to renovate it. He holds the house for 35 years…

A: Purchase price: $90,000Renovation cost: $15,000Selling price: $400,000

Q: Judy’s mother, Sarah, died on July 2, 2018, leaving Judy her entire estate. Included in the estate…

A: Rental Income: Rental income from the property could be treated as income from house property and…

Q: Jim sells a parcel of land for $75,000 cash and the buyer assumes Jim's liability of $10,000 on the…

A: The gain is the amount that separates the carrying amount recorded in the business's books from the…

Q: Rafael sold an asset to Jamal. What is Rafael's amount realized on the sale in each of the following…

A: Rafael's amount realized on the sale in each of the following alternative scenarios:-

Q: Bob owned a duplex used as rental property.  The duplex had an adjusted basis to Bob of $86,000 and…

A: Given information:   Adjusted basis - $86,000 Fair Market Value - $300,000

Q: Bernice sells her house to John on August 1 for $500,000, cash. The yearly real estate taxes (Jan. 1…

A: Federal income tax is a tax levied by the United States federal government on individuals,…

Q: In 2011, Avery bought a gold necklace for her own use at a cost of $8,000. In 2018 when the fair…

A: Formula: Taxable Gain = Selling price - Fair market value  Deduction of fair market value from…

Q: On August 31, 2019, Harvey and Ling, who file a joint return and live in Charleston, South Carolina,…

A: Sec 121 of IRS Code:- This section allows a taxpayer who files jointly to exclude $500,000 of…

Q: Normandy owns Canyon, Inc. stock (adjusted basis of $20,000) which is sold to Shannon, a sibling,…

A: Gain refers to the difference between the sales price and the purchase price of any asset. It is…

Q: Madeline sells her personal scooter for $3,600. She purchased the scooter for $4,320 three years…

A: Gain: If the amount received from selling an asset is higher than its original cost or basis, it…

Q: a new home in Houston. The realized gain on the second sale is $275,220. Do not round any division.

A: In this question, we have to find out the recognized gain on the second sale.

Reasons for Estate Planning

Planning is a process that helps decide in advance about future activities and operations. Planning helps to draft the procedures by identifying, analyzing, and designing how to work, when to work, by whom should be done, and what has to be done. It is the primary step followed by a person, business organizations, institutions, companies, etc.