1. Single Taxpayer buys a mountain cabin on January 1, 2013 for $200,000 which Single used...

 

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1. Single Taxpayer buys a mountain cabin on January 1, 2013 for $200,000 which Single used as a vacation home through December 31, 2015. In 2015, Single sells her principal residence at a gain which is excluded under 121. On January 1, 2016, Single moves into the mountain cabin and uses it as her principal residence. (a) If Single sells the mountain cabin for $350,000 on January 1, 2018, how much of the gain is included in her gross income? (b) What result in (a), above, if Single sells the mountain cabin for $900,000? (c) What result in (a), above, if Single purchased the mountain cabin and began using it as a vacation home on January 1, 2004? (d) Do the nonqualified use rules apply to Single if Single purchases and uses a principal residence for two years, then rents it out for two years prior to selling it? once for 10 1. Single Taxpayer buys a mountain cabin on January 1, 2013 for $200,000 which Single used as a vacation home through December 31, 2015. In 2015, Single sells her principal residence at a gain which is excluded under 121. On January 1, 2016, Single moves into the mountain cabin and uses it as her principal residence. (a) If Single sells the mountain cabin for $350,000 on January 1, 2018, how much of the gain is included in her gross income? (b) What result in (a), above, if Single sells the mountain cabin for $900,000? (c) What result in (a), above, if Single purchased the mountain cabin and began using it as a vacation home on January 1, 2004? (d) Do the nonqualified use rules apply to Single if Single purchases and uses a principal residence for two years, then rents it out for two years prior to selling it? once for 10

Answer rating: 100% (QA)

Answer a To determine how much of the gain from the sale of the mountain cabin is included in Singles gross income we need to consider the rules regar... View the full answer