2.Jack inherited a house from his father, Zack, on the death of his father, in January 2019. A Federal estate tax return was filed and the value of the land as finally determined for Federal estate tax purposes was $300,000 (the property's fair market value at the date of the death). Zack had acquired the house in 1958 for $19,000 and prior to Zack's death had made permanent improvements of $50,000. How much is Jack's basis in the land?
3.Assume that in 2019 Taxpayer makes a donation to qualified public charity of real estate held by Taxpayer for investment for five years and having a fair market value of $20,000 on the date of the contribution. Taxpayer's basis in the property is $30,000. How much loss or deduction would be allowable to or recognized by taxpayer as a result of this transaction?
a. Taxpayer would recognize a capital loss of $10,000 that may be used to offset Taxpayer's capital gains.
b. There would be no deductible loss allowable with respect to the inherent loss in the property, but taxpayer may take a charitable deduction of $20,000 subject to the adjusted gross income percentage limitation, and provided Taxpayer itemizes deductions.
c. Taxpayer may carry over the loss until Taxpayer makes a bargain sale of other real estate to a public charity.
d. Taxpayer's allowable charitable income tax deduction would be $30,000.
4. Taxpayer purchased a personal residence on December 29, 2018 for $266,000. The fair market value of the residence was $280,000 when it was damaged by a flood on June 10, 2019 that resulted from not turning off the bath water before leaving for vacation. The fair market value of the residence after the flood was $240,000 and insurance proceeds received in August 2019 totaled $15,000. What is the net amount of casualty loss Taxpayer may deduct for 2019 as an itemized deduction if Taxpayer's adjusted gross income is $120,000?
5. Jane owns a building for investment with an adjusted basis of $340,000 and a fair market value of $750,000. She exchanges the building today for a building owned by Sue that Jane will use in her business. Sue's building has a fair market value of $950,000 and is subject to a $200,000 liability. Jane assumes Sue's liability and uses the building in her business. How much, if any, is Jane's realized gain, recognized gain, and basis in the building received?
a. Gain realized of $610,000, gain recognized of 0, and basis in new building of $340,000
b. Gain realized of $610,000, gain recognized of $610,000, and basis in new building of $750,000
c. Gain realized of $410,000, gain recognized of 0, and basis in building of $540,000
d. Gain realized of $410,000, gain recognized of $410,000, and basis of $750,000
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