1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 12 An individual taxpayer sells residential rental property to their child for $100,000. The child gives the taxpayer $1,000 and an installment note for the balance of $99,000. The taxpayer's basis is $50,000. The child pays the taxpayer $4,000 in Year 1. In Year 2, after paying the taxpayer $5,000, the child sells the property for $70,000. Which of the following statements about this situation is correct? A. The taxpayer should report the entire gain of $50,000 in Year 1 because installment sales of depreciable property are not allowed between related parties. B. The taxpayer should report $2,500 gain in Year 1. C. The taxpayer should report the entire gain of $50,000 in Year 1 because the child disposed of the land within two years of purchase. D. The taxpayer should report a $49,000 gain in Year 2. Feedback

deprociable picoenty we not allowed betemen ielated parties Ind within tero years of purchase. A. 82000 B. 547525 c. 849,525 D. 552475 An individual had the following gains and loseses for the year: What will be the net capital gain (loss) reported by the individual and at what applicable tax rateis? A. Shortterm ordinary loss of $3,000, long-term gain of $15,000 at 15 . Section 125 gain of $18,000 at 25%, and collectibles gain of $20,000 at 2 . 1 rate. B. Section 1250 gain of $3.000 at 25$ and collectibles gain of $20.000 at 26s rate C. Section 1250 gain of $8.000 at 25% and longterm gain of $15.000 at 15% D. Long-term gain of $23,000 at the 152 rate