Tracy owns a non-depreciable capital asset held for investment. The asset was purchased for $250,000 six years earlier and is now subject to a $75,000 liability. During the current year, Tracy transfers the asset to Tim in exchange for $94,000 cash and a new automobile with a $50,000 FMV to be used by Tracy for personal use; Tim assumes the $75,000 liability. Determine the amount of Tracy's LTCG or LTCL.

Doug receives a duplex as a gift from his uncle. The uncle's basis for the duplex and land is $90,000. At the time of the gift, the land and building have FMV's of $40,000 and $80,000, repectively. No gift tax is paid by Doug's uncle at the time of the gift.

a. To determine gain, what is Doug's basis for the land?

b. To determine gain, what is Doug's basis for the building?

c. Will the basis of the land and building be the same as in Parts a and b for purpose of determining a loss?

Bud received 200 shares of Georgia Corporation stock from his uncle as a gift on July 20, 2008, when the stock had a $45,000 FMV. The uncle paid $30,000 for the stock on April 12, 1998. The taxable gift was $45,000, because his uncle made another gift to Bud for $20,000 in January. The uncle paid a gift tax of $1,500.

Donna files as a head of household in 2009 and has taxable income of $90,000. including the sale of a stock held as an investment for two years at a gain of $20,000. Only one asset was sold during the year and Donna does not have any capital loss carryovers.

a. What is the amount of Donna's tax liability?'

b. What is the amount of Donna's tax liability if the stock is held for 11 months?

Answer rating: 100% (QA)

a Tracy collects 219000 cash car and liability b The basis in the property is 250000 so she has a longterm capital loss of 31000 At the time of the gift the land and building have FMVs of 40000 and 80... View the full answer