Question: John (a single man) purchases a house for $90,000 plus $5,000 for settlement costs. He lives in the house for 35 years and then sells

John (a single man) purchases a house for $90,000 plus $5,000 for settlement costs. He lives in the house for 35 years and then sells it for $395,000.

Assume that his capital gains tax rate is 15%, how much tax will he owe?

Multiple Choice

$45,000

None of the choices are correct.

$5,000

$50,000

$7,500

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