Consider the following information for Mr. and Mrs. Di Palma:
• On June 10, 2021, they sold their principal residence for $80,000 and incur $6,000 of selling expenses. The basis of the residence, acquired in 2009, is $50,000.
• On June 25, 2021, they purchased a new principal residence for $90,000 and occupied it immediately.
• On May 10, 2022, they purchase their neighbor’s residence for $115,000 and occupy the residence immediately.
• On August 29, 2022, they sell the residence purchased on June 25, 2021, for $148,000.
They pay $7,000 of selling expenses. Determine:
a. Realized gain on the sale of the residence in 2021.
b. Recognized gain on the sale of the residence in 2021.
c. Realized gain on the sale of the residence in 2022.
d. Recognized gain on the sale of the residence in 2022.