1. Carl Cox gave his daughter, Ellen, his personal residence. Carl had a basis of $260,000 for the house, which had a market value of $240,000 on the date of the gift. Ellen lived in the house for three years, then sold it for $230,000. How will Ellen report the sale of the house on her federal income tax return? Recognize a $10,000 loss Recognize a $20,000 loss Recognize a $30,000 loss Recognize a zero loss B E None of the above