Question
1.Michelle purchased her home for $150,000, and subsequently added a garage costing $25,000 and a new porch costing $5,000. Repairs to the home's plumbing cost
1.Michelle purchased her home for $150,000, and subsequently added a garage costing $25,000 and
a new porch costing $5,000. Repairs to the home's plumbing cost $1,000. What is the amount of
the adjusted basis in the home?
2.Monte inherited 1,000 shares of Corporation Zero stock from his father who died on March 4 of
the current year. His father paid $30 per share for the stock on September 2, 1995. The FMV of
the stock on the date of death was $50 per share. On September 4 this year, the FMV of the stock
was $55 per share. The executor did not elect the alternate valuation date. Monte sold the stock
for $65 per share on December 3. What is the amount and nature of any gain or loss?
A) $ 10,000 LTCG
B) $ 10,000 STCG
C) $ 15,000 LTCG
D) $ 15,000 STCG
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