4.Sarah (single) purchased a home on January 1, 2008 for $600,000. She eventually sold the home for $790,000. Sarah used the property as a vacation home through December 31, 2016. She then used the home as her principal residence from January 1, 2017 until she sold it on January 1, 2020.What amount of the gain on the sale does Sarah recognize?

5.Javier and Anita Sanchez purchased a home on January 1, 2019 for, $500,000 by paying $200,000 down and borrowing the remaining $300,000 with a 8 percent loan secured by the home. The loan requires interest-only payments for the first five years. The Sanchezes would itemize deductions even if they did not have any deductible interest. The Sanchezes marginal tax rate is 32 percent. What is the after-tax cost of the interest expense to the Sanchezes in 2019?

6.In year 1, Peter and Shaline Johnsen moved into a home in a new subdivision. Theirs was one of the first homes in the subdivision. In year 1, they paid $1,500 in real property taxes on the home to the state government, $500 to the developer of the subdivision for an assessment to pay for the sidewalks, and $700 for real property taxes on land they hold as an investment. What amount of property taxes are the Johnsens allowed to deduct assuming their itemized deductions exceed the standard deduction amount before considering any property tax deductions?