In the current year, Debbie receives stock as a gift from her uncle, Jerry. Jerry had originally

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In the current year, Debbie receives stock as a gift from her uncle, Jerry. Jerry had originally purchased the stock for $27,000 several years ago. At the time of the gift, the fair market value of the stock is $17,000. One month later Debbie sells the stock for $16,500. What is the amount and character of Debbie’s recognized gain or loss from the sale?

Now, assume instead that one month later Debbie sells the stock for $30,500. What is the amount and character of Debbie’s recognized gain or loss from the sale?

Now, assume instead that Debbie holds on to the stock for another year and sells it for $20,000. What is the amount and character of Debbie’s recognized gain or loss from the sale

Faith inherits a parcel of land from her father on February 15, 2019. Her father had purchased the land on August 25, 1970 and his basis in the land was $325,000. The fair market value of the land at the date of death is $1,100,000. Faith sells the land on December 15, 2019 for $1,500,000. Assuming Faith held the land for investment, what is the amount and character of Faith’s recognized gain or loss on the sale?

Would your answer change if the father’s basis in the land was greater than the FMV on the date of death?

Frank purchased a warehouse for personal use in July 2015 for $120,000. In August 2018 he decided to use the warehouse for business purposes and converted it to business-use when the fair market value was $85,000. On December 15, 2021, Frank sells the building for $60,000. At the time of the sale he had recorded $7,125 of accumulated depreciation. What is Frank’s recognized gain or loss on the sale of the warehouse?

Now assume instead that Frank sold the building for $120,000. What is Frank’s recognized gain or loss on the sale of the warehouse?

Now, assume instead the Frank sold the building for $90,000. What is Frank’s recognized gain or loss on the sale of the warehouse?

Posted Date: Dec 20, 2021 12:55 AM

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