AC553_W7_Solution10_37 - Solution Since the fair market...

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1 Problem 10-37 Solution Basis: Gift Property Marsha Moore gave property with an adjusted basis of $28,000 to Alfred when the fair market value of the property was $25,000. Gift taxes paid on the property were $3,000. What is Alfred’s basis for gain?
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Unformatted text preview: Solution: Since the fair market value is less than the basis, no appreciation has occurred. The basis for determining loss is $25,000, and the basis for determining gain is $28,000. None of the gift tax paid is added to determine the donee's basis....
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