Assume that the Castinos realized their dream and built a second home for $500,000 on the undeveloped parcel of land they had bought 2 years ago. After they moved into their new home, real estate prices began to appreciate rapidly in their area. The Castinos sold their home six months later while the market was hot, for $5 million. What is the tax consequence of this transaction? A. $4.32 million of recognized long-term captial gain B. $4.32 million of realized short-term capital gain C. $3.82 million of recognized long-term capital gain D. $3.82 million of realized long-term capital gain

Answer rating: 100% (QA)

The detailed answer for the above question is provided below The tax consequence of the transaction ... View the full answer