Paden, who is single and has been employed as an accountant for 27 years with Harper, Inc., lost his job due to company downsizing. His last day of employment is July 31, 2023, and Harper provides a \($9,000\) severance payment. The severance payments are based on an employee’s time of employment. During the year, Paden received a salary from Harper of \($72,000.\) Harper also paid \($8,500\) of Paden’s medical insurance premiums.

In May 2023, Paden, who had always wanted to be associated with a football team, applied for the head coaching job at Hawk University in Iowa and, much to his surprise, received the job beginning on August 1. In June and July, Paden paid \($4,500\) to take courses in sports management at the local university. Hawk University is substantially short of funding and Paden paid \($2,000\) for entertainment expenses related to his job and \($500\) for supplies. No reimbursement was received.

His salary from Hawk is \($11,000\) per month payable at the end of each month. His salary for December was not received until January 6, 2024.

On August 1, he sold his house for \($329,000\) in Texas and paid a sales commission of \($14,000.\) He inherited the house 20 years ago when his mother died. Her basis for the house was \($37,000\) and the FMV when she died was \($50,000.\) Property taxes for the 2023 calendar year amount to \($8,200,\) and property taxes were apportioned at the closing.

Property taxes are payable on October 1. He paid \($2,100\) of interest on home equity debt of \($30,000,\) incurred to purchase a new car.

To move to Iowa, he drove 700 miles and spent \($62\) for meals during the trip in July.

Movers charged \($4,150\) to move his household items. He purchased a new house in Iowa for \($250,000\) on August 15 and borrowed \($222,000.\) He also agreed to pay all property taxes for 2023. Real property taxes for the home in Iowa will be paid on January 30, 2024, and amount to \($1,500\).

Interest on the \($222,000\) debt during the current year is \($3,120.\) To obtain the loan, Paden paid points of \($2,000\) .

He contributed common stock (basis of \($1,000\) and FMV of \($8,000)\) held as an investment for three years to Hawk University. He also paid state income taxes of \($2,465\) which was greater than state sales taxes for the year) as well as personal property taxes of \($555\) for his car.

Paden sold 200 shares of Dell Corporation stock on April 10 for \($100\) per share. His basis was \($145\) per share. On May 1, he purchased 300 shares of Dell at \($89\) per share.

Determine:

1. gross income without considering the sale of his house or the Dell Corporation stock.

2. recognized gain due to the sale of his house.

3. net capital gain.

4. adjusted gross income.

5. total amount of itemized deductions.

6. taxable income.

7. basis of his house in Iowa.

8. if the sales price for his home was \($470,000\) instead of \($370,000,\) would his taxable income increase by more than \($100,000.\) If yes, explain.