Jack and Kim were coworkers who fell in love and got married. They sold their principal residence in MD for the net amount of $1,000,000 after all selling expenses. Jack and L bought the house 9 years ago and occupied it until it was sold. On the date of sale, the house had a cost basis of $200,000. What amount of gain should Jack and Kim recognize from the sale of the residence? 

Options:

• $1,000,000 
• $800,000 
• $300,000 
• $550,000
  
  

Answer rating: 100% (QA)

Step 1 Capital gain from sale of a principal residence is the difference betwe... View the full answer