Question

41. In January, Lance sold stock with a cost basis of 526,000 to his brother, James, for $24,000, the fair market value of th
0 0
Add a comment Improve this question Transcribed image text
Answer #1

TAX EFFECT OF GIVEN TRASACTIONS

The correct option is (d ) - Disallowed loss to lance of $2000, Gain to james $1000.

Lance realised a loss of $2000 ( $26000 - $24000 ) need to be disallowed

And

James realised a gain of $3000 ( $27000 - $24000 ), but james may reduce his gain of $3000 by disallowed loss of $2000 to lance. As a result,

james recognized a gain of $1000.

______×______

ALL THE BEST,

Keep Learning

Add a comment
Know the answer?
Add Answer to:
41. In January, Lance sold stock with a cost basis of 526,000 to his brother, James,...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions
  • h period oruzed ver a 180-T e. Not deductible 40. If a residence is used primarily...

    h period oruzed ver a 180-T e. Not deductible 40. If a residence is used primarily for personal use (rented for fewer than 15 days per year), which of the following is correct? a. No income is included in AGI b. No expenses are deductible. c. Expenses must be allocated between rental and personal use d. Only a. and b. are correct. e. Choices a., b., and c. are correct. 41. In January, Lance sold stock with a cost basis...

  • Deirdre sold 112 shares of stock to her brother, James, for $3,584. Deirdre purchased the stock...

    Deirdre sold 112 shares of stock to her brother, James, for $3,584. Deirdre purchased the stock several years ago for $4,592. (Loss amounts should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable.) a. What gain or loss does Deirdre recognize on the sale? b. What amount of gain or loss does James recognize if he sells the stock for $4,816? c. What amount of gain or loss does James recognize if he sells the...

  • Deirdre sold 153 shares of stock to her brother, James, for $4,131. Deirdre purchased the stock...

    Deirdre sold 153 shares of stock to her brother, James, for $4,131. Deirdre purchased the stock several years ago for $5,661. (Loss amounts should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable.) a. What gain or loss does Deirdre recognize on the sale? Recognized gain or loss------------------? b. What amount of gain or loss does James recognize if he sells the stock for $5,967? Recognized gain or loss------------------? c. What amount of gain or...

  • 6. George bought the following amounts of Stock A over the years: Stock A Stock A...

    6. George bought the following amounts of Stock A over the years: Stock A Stock A Stock A Date Purchased 11/21/1991 3/18/1997 5/22/2006 Number of Shares 1,000 500 750 Adjusted Basis $24,000 9,000 27,000 On October 12, 2017, he sold 1,200 of his shares of Stock A for $38 per share. a) How much gain/loss will George have to recognize if he uses the FIFO method of accounting for the shares sold? b) How much gain/loss will George have to...

  • Jose sells stock with an adjusted basis of $65,000 to his son, Jesse, for its fair...

    Jose sells stock with an adjusted basis of $65,000 to his son, Jesse, for its fair market value of $40,000. Jesse sells the stock one year later for $50,000. Jesse will recognize a gain(loss) on the subsequent sale of A) $0. B) $10,000 gain. C) $15,000 gain. D) $20,000 loss.

  • Harold owns 130 shares of stock in Becker Corporation. His adjusted basis for the stock is...

    Harold owns 130 shares of stock in Becker Corporation. His adjusted basis for the stock is $215,000. On December 15, 2018, he sells the stock for $180,000. He purchases 195 shares of Becker Corporation stock on January 12, 2019, for $230,100. a. What are Harold's realized and recognized gain or loss on the sale? b. What is Harold's adjusted basis for the 195 shares purchased on January 12, 2019? c. How would your answers in (a) and (b) change if...

  • Harvey sold stock valued at $29,000 to his son for $15,000 Harvey's basis in the stock...

    Harvey sold stock valued at $29,000 to his son for $15,000 Harvey's basis in the stock is $26000.how does he report his gift tax which is correct? A)harvey reports a gift of $29,000 on form 709 and a capital loss of 14,000 on form 1040, Silass basis in the stock is 15,000. B)no reporting is required because a transfer was between immediate family members. C) Harvey is not required to report the $14,000 gift and is not allowed to deduct...

  • t sold his s corporation stock for $100,000. His basis in the stock was $40,000, which...

    t sold his s corporation stock for $100,000. His basis in the stock was $40,000, which was also its book value. his share of s corporation assets included depreciable equipment with a basis of $10,000 and a fair market value of $25,000. which of the following statements is correct regarding the sale by T? A) if T was a material participant in the LLC entity, his taxable capital gain for regular tax purposes is $45,000. B) if T was a...

  • T-7. On December 15, 2018 Ralph gave his daughter, Barbara, stock that had an adjusted basis...

    T-7. On December 15, 2018 Ralph gave his daughter, Barbara, stock that had an adjusted basis to Ralph of $8,000 and a fair market value on the date of the transfer of $6,000). Ralph paid a gift tax attributable to this transfer. Barbara sold the stock on June 19, 2019 for $10,000. How much was Barbara’s recognized gain and the character of the gain?    a.             $2,000 long-term capital gain b.             $4,000 ordinary income c.             $4,000 short-term...

  • Ralph gives his daughter, Angela, stock (basis of $8,000; fair market value of $6,000). No gift...

    Ralph gives his daughter, Angela, stock (basis of $8,000; fair market value of $6,000). No gift tax results. If Angela subsequently sells the stock for $10,000, what is her recognized gain or loss? Group of answer choices None of the above $0 $4,000 $10,000 $2,000

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT