Al's father and mother were placed in a nursing home. They gave him the family farm prior to their admission. The farm has been in the family for as long as his father can remember. His father does not know the original purchase price of the farm, but the FMV of the farm was $285,000 at the time of the gift. Al's parents made the following improvements to the land while it was in their possession.

Installed fencing Built two new barns Paved driveway

What is Al's basis in the farm?

a) $285,000 b) $ 83,000 c) $ 92,350 d) $ 80,000

$ 6,000 $ 45,000

Installed a new well Addition to the house Installed storm windows

$ 2,250 $ 35,000 $ 3,000