None When Barry's grandmother passed away, she gave Barry a diamond ring that was worth $6,000 at the time of death. Barry's grandmother had purchased the ring for $5,400. What isBarry's basis in the ring if he sells it for $7,000? What if he sells it for $5,000? What if he sellsit for $5,800?$fill in the blank 3regardless of sales price

Understanding the Concept of Basis:When property is inherited, the basis (or cost) of the property…

Answered: When Barry's grandmother passed away,…

Individual Income Taxes

43rd Edition

ISBN:9780357109731

Author:Hoffman

Publisher:Hoffman

Chapter14: Property Transactions: Determination Of Gain Or Loss And Basis Considerations

Section: Chapter Questions

Problem 32P

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Similar questions

When Barry’s grandmother passed away, she gave Barry a diamond ring that was worth $6,000 at the time of death. Barry’s grandmother had purchased the ring for $5,400. What is Barry’s basis in the ring if he sells it for $7,000? What if he sells it for $5,000? What if he sells it for $5,800?
Vijay sells land and receives $5,000 cash, a motorcycle worth $1,600, and two tickets to the Super Bowl with a total face value (cost) of $800 but worth $1,200. In addition, the buyer assumes the mortgage on the land of $12,000. What is Vijay's amount received in this transaction? $5,000 $7,800 $8,200 $19,800 $20,200
Wade paid 7,000 for an automobile that needed substantial repairs. He worked nights and weekends to restore the car and spent 2,400 on parts for it. He knows that he can sell the car for 13,000, but he is very wealthy and does not need the money. On the other hand, his daughter, who has very little income, needs money to make the down payment on a house. a. Would it matter, after taxes, whether Wade sells the car and gives the money to his daughter or whether he gives the car to his daughter and she sells it for 13,000? Explain. b. Assume that Wade gave the car to his daughter after he had arranged for another person to buy it from his daughter. The daughter then transferred the car to the buyer and received 13,000. Who is taxed on the gain?
MA1. Lance trades a refrigerator that he uses in his tavern for a freezer that Jane has in her basement. The fair market value of the refrigerator is $850, and Lance's adjusted basis is $125. The FMV of the freezer is $850, and Jane's adjusted basis is $175. Lance plans to use the freezer in his tavern. Assume that the exchange is like-kind. What is Lance's realized gain or loss? a. $850 b. $725 c. $0 d. $125
Aaron and Melissa are looking to sell their house for $700,000. They purchased the house seven years ago for $480,000 and didn't have any adjustments to factor in. If Aaron and Melissa sell their house for $700,000, how much will they have to pay in capital gains? O $700,000. Married couples are required to pay capital gains on the final sales price. O $220,000. All sellers have to pay capital gains on the sales price minus the price they originally paid. O $0. The $500,000 capital gains exclusion will allow them to write off any profits earned on the property. $0. Capital gains is only paid on commercial properties.
I hire Susan to sell my house. I tell her that I'm hoping to get $200,000 for the house. She tells me she needs $2,000 to make repairs on the house before it is listed for sale. I give her the $2,000. She takes my money but never makes the repairs. The house sells for $220,000. If Susan is ordered to pay restitution, she will have to pay $ 2000
Ariel's grandmother, Mariam, gave her a diamond ring as a gift, which Mariam's husband had given her at the birth of their first child. The original cost of the ring was $3,000. At the time Ariel received the ring, the fair market value was $4,000. What is Ariel's basis for the ring? $0 $1,000 $3,000 $4,000
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Joe buys a piece of land on January 3rd of the current year. He pays $10,000 in cash. 1) Suppose instead the land is subject to a mortgage of $3,000 and Joe receives$12,000 in cash and the buyer assumes Joe’s mortgage on the land. Does Joe realize a gain or loss and if so how much is it? 2) Suppose Joe instead received a piece of jewelry worth $12,000 and the buyer assumes Joe’s mortgage on the land. Does Joe realize a gain or loss and if so, how much is it? note: if you can't answer both, please answer question number 2
Your client has a real estate asset used in his business. He exchanges it for a like-kind real estate asset owned by Ava. The basis of your client's asset is $50,000 and he gives Ava $25,000 cash plus the asset in exchange for Ava's asset, which is worth $40,000. Ava's basis in her original asset is $9,000. What is Ava's gain or loss? A. $25,000 gain recognized. $31,000 gain realized and recognized. C. $0 gain recognized. D. $0 loss recognized.
1. In 2020, Chris sold a painting to Bernie for $40,000. Chris received $10,00 in 2020 and will receive $30,000 in 2021. Chris bought the painting in 2016 for $15,00O. Bernie did not pay Chris $30,000 when it was due, and after numerous attempts to collect (and $1,000 in expenses), Chris repossessed the paining in 2021. The painting was worth $45,000 when repossessed. "What is Chris's recognized gain in 2020? a. $25,000 b. $10,000 c. $6,250 What are the results of the repossession to Chris? a. $45,000 LTCG; basis = $45,000 b. $33,750 LTCG; basis = $45,000 c. $33,750 LTCG; basis = $44,00 d. $32,750 LTCG; basis = $45,000
Jane died with $1,000,000 in cash and a house worth $ 400,000. The house has a mortgage of $200, 000 on it . Which of these might happen? Group of answer choices Jane's house cannot be left to the children because of the mortgage. The children will have to pay the mortgage even if they don't get the house, because their mom did not pay it off before she died. Jane can leave the house to her children in her will. The children won't have to pay their mom's mortgage. Jane can leave the house to her children in her will. They will have to pay the mortgage or sell the house.

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