Question: The answers in the box are not correct. Please help me 4. . Tara owns a house that she has been living in for eight

The answers in the box are not correct. Please help me

4. . Tara owns a house that she has been living in for eight years. She purchased the house for

$200,000 and the FMV today is $ 160,000. She is moving into herfriends house and has decided to convert her residence to rental property. Assume 20% of thepropertys value is allocated to land.

Requirement

a. What is the basis of the house for depreciation? is $ 128,000

b. Requirement b. If she claims depreciation of $12,800 and sells the property six years later for $310,000 (20% allocated toland), determine the gain on the sale of the building and gain on the sale of the land.

c. Requirement c. How much of the gain is due to depreciation?

Amount realized

$248,000

$62,000

Less:

Adjusted basis

(147,200)

(40,000)

Realized gain (loss)

$100,800

$22,000

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