Question: Taxpayer receives stock as a gift from his nephew. The adjusted basis of the stock is $10,000 and the fair market value is $30,000. Taxpayer

Taxpayer receives stock as a gift from his nephew. The adjusted basis of the stock is $10,000 and the fair market value is $30,000. Taxpayer trades the stock for bonds with a fair market value of $25,000 and $5,000 cash. What is his recognized gain and the basis for the bonds?

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