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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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?
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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1 Corinne sells the following personal items in 2021: Necklace: Corinne purchased a necklace for $800 a few years ago and sells it for $1,200 in 2020. Antique Desk: Corinne had an antique desk that she bought a number of years ago for $1,050. In 2021, she was able to sell the desk to an antique dealer for $1,300. Rare Manuscript: Corinne sold a rare manuscript to a museum in 2021 for $1,300. She had acquired it many years ago for $1,800. Bicycle: Corinne sold her beloved mountain bike for $800 in 2021. She had purchased the premium bike a few years Assume Corinne has no other capital gains or losses in 2021. Required: A. Calculate any Taxable Capital Gain or Allowable Capital Loss (enter a 0 if none) that Corinne will include in her 2021 Net Income for Tax Purposes calculation with respect to each item. If the item is Personal Use Property, enter your answer in the PUP column. If the item is Listed Personal Property, enter your answer into the LPP column. Leave any unused squares…
Given the situations below, which item still has the same basis as when it was purchased? Bob sold his rental property after claiming depreciation. Ebenezer's's father gifted him a car that cost him $25,000. The FMV on the date of the gift was $15,000. Ebenezer sold the car at a loss. Liz Marley acquired a rare stamp as a bequest when her father passed away. A coin is now worth double what Tim paid for it. a. Bob's rental property. b. Ebenezer's car. c. Liz's stamp. d. Tim's coin. For the "kiddie tax" rule to apply, the child must a. Have at least one living parent. b. Not have attained age 23 in the tax year.
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My father purchased his home in 1974 for $38,000. He sold it in 2020 for $225,000. What rate of appreciation (interest) did the price of his home experience?
Mary owns a home with a with a replacement value of $331,195. She purchased home insurance in the amount of $200,000, and therefore does not meet the 80% rule. If Mary's deductible is $3,000 and a BBQ fire caused $75,000 worth of damage, how much will Mary have to pay herself?
Dave bought a Ford Mustang seven years ago for RM32,000. He has decided to sell it as he now needs a pick-up truck for his new business. He received RM12,000 for it from a dealer in part exchange, which means that since the price of the Ford Mustang was more than that of the pick- up truck, Dave received RM12,000 and the pick-up truck in exchange for his Ford Mustang. What was his rate of return for his transaction?

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