In 2005, Duncan purchased 2,000 shares of stock for $50,000 in a midsize local company with gross

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In 2005, Duncan purchased 2,000 shares of stock for $50,000 in a midsize local company with gross assets of $15,000,000. In 2015, Duncan sold the stock for $68,000. How is the gain treated for tax purposes?

a. $18,000 capital gain and taxed at preferential rates.

b. $9,000 excluded from gross income under §1202 and $9,000 taxed at regular rates.

c. $9,000 excluded from gross income under §1202 and $9,000 taxed at 28%.

d. $13,500 excluded from gross income under §1202 and $4,500 taxed at preferential rates.

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Fundamentals Of Taxation 2016

ISBN: 9781259812774

9th Edition

Authors: Ana Cruz, Michael Deschamps, Frederick Niswander, Debra Prendergast, Dan Schisler, Jinhee Trone

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Question Posted: Jul 12, 2017 09:20 AM

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In 2005, Duncan purchased 2,000 shares of stock for $50,000 in a midsize local company with gross

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Fundamentals Of Taxation 2016

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