Blank answer choices for pat e.: 1. does, does not 2. gain, loss 3. gain, loss 4. is a number 5. is a number 6. any increase in value, depreciation allowable 7. is a number 8. carryover, be lost 9. able, unable 10. deductible, not deductible

I am pretty sure part a-d are correct but just double checking.

Surendra's personal residence originally cost $340,000 (ignoring the value of the land). After living in the house for five years, he converts it to rental property. At the date of conversion, the fair market value of the house is $320,000. a. Surendra's basis for loss for the rental property is \$ b. Surendra's basis for depreciation for the rental property is s c. Surendra's basis for gain for the rental property is $ d. Could Surendra have obtained better tax resuits if he had sold his personal rsidence for $320,000 and then purchased another house for $320,000 to hold as rental property? No, since this is a personal use ass, t, this realized loss is not recognized. Complete the letter below regarding an e-mail to your instructor. TO: Instructor FROM: Student DATE: January 6,2023 The purpose of this e-mail is to address the tax issues associated with Surendra's conversion of his principal residence into a rental property. I am basing my conclusiorls on the information provided. The original cost (and adjusted basis at the time of the conversion) of Surendra's house was $340,000. Under 5165 and the Regulations, when a personal use asset is converted to a business or income-producing asset, the basis of the rental property carry over from the personal use adjusted basis. Similar to property received by gift, the basis depends on the ultimate disposition of the property as either a gain or a loss. If a the basis is the lower of the fair market value on the date of the conversion or the carryover adjusted basis. If the property were ultimately sold at a the basis is the adjusted basis at the time of the conversion. In Surendra's case, her gain basis is $ and loss basis is $ The conversion to business property requires that the property refiect once placed in service. This requires that a depreciable basis be determined prior to the ultimate disposition of the property. Under 167 and the Regulations, the depreciable basis, in Surendra's case, is $ Unless Surendra is able to sell the property for a gain, the realized loss incurred before the conversion will Surendra will be to recognize the loss if he sells the home rather than converting it to business or incomeproducing use because losses on personal use assets are generally Thank you for asking me to address these topics