On July 31, 2018, Jessica-Anne received land and a building from Janice as a gift. Janice's...

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On July 31, 2018, Jessica-Anne received land and a building from Janice as a gift. Janices adjusted basis and the fair marke

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Answer 1

Answer #1

a) Determine Jessica-Anne's adjusted basis for the land and building.

Adjusted basis for Jessica-Anne's = Janice basis+(Appreciation/market value*Gift tax)

=200000+((260000-200000)/(260000*60000))

= $200,000+213846.15

Adjusted basis of building = 640000+((700000-64000/700000*60000))

= 640000+5142.85

= $645142.85

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Answer 2

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