Mitchell and Debbie Dixon, a married couple, sell their personal residence to Sophie. Sophie pays $225,000 and assumes their $70,000 mortgage. To make the sale the Downs pay $4000 in commissions and $1.000 in legal costs. The couple has owned and lived in the house for seven years and their tax basis is $125000. What is the amount of gain recognized on the sale?

A. $0

B. $165,000

C. $100,000

D. $170,000

Answer rating: 100% (QA)

A 0 Explanation Because as per internal revenue code section 121 a ... View the full answer