Tracy owns a non-depreciable capital asset held for investment. The asset was purchased for $250,000 six years earlier and is now subject to a $75,000 liability. During the current year, Tracy transfers the asset to Tim in exchange for $94,000 cash and a new automobile with a $50,000 FMV to be used by Tracy for personal use; Tim assumes the $75,000 liability. Determine the amount of Tracy's LTCG or LTCL.
Tracy owns a non-depreciable capital asset held for investment. The asset was purchased for $250,000 six years earlier and is now subject to a $75,000 liability. During the current year, Tracy transfers the asset to Tim in exchange for $94,000 cash and a new automobile with a $50,000 FMV to be used by Tracy for personal use; Tim assumes the $75,000 liability. Determine the amount of Tracy's LTCG or LTCL.
Chapter3: Tax Formula And Tax Determination; An Overview Of property Transactions
Section: Chapter Questions
Problem 48P
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Transcribed Image Text:Tracy owns a non-depreciable capital asset held for
investment. The asset was purchased for $250,000 six years
earlier and is now subject to a $75,000 liability. During the
current year, Tracy transfers the asset to Tim in exchange for
$94,000 cash and a new automobile with a $50,000 FMV to
be used by Tracy for personal use; Tim assumes the $75,000
liability.
Determine the amount of Tracy's LTCG or LTCL.
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