Casper and Cecile divorced in $2018.$ As part of the divorce settlement, Casper transferred stock to Cecile. Casper purchased the stock for

$$87,500,$ and it had a market value of $$140,000$ on the date of the transfer. Cecile sold the stock for $$122,500$ a month after receiving it$.$ In

addition Casper is required to pay Cecile $$4,375$ a month in alimony. He made five payments to her during the year.

By how much will each of the above transfers and transactions impact Casper's AGI? Cecile's AGI?

Casper

$$ required to recognize any gain on the transfer of the stock to Cecile. Further, although he

deduct anything related to the transfer of the stock, he may deduct the $

of alimony payments.

Cecile

include the recelpt of the stock in her gross income, She must, however, recognize a capital

$$ of $s$

when the stock is sold and

zrecognize income from the alimony payments.