Corporation W had earning & profits (E&P) of $95,000 on December 31, Year 1. Based on the following information, compute total E&P as of December 31, Year 2. Taxable income $185,000 Contributions in excess of 10% limitation 1,500 Interest paid on loan used to purchase tax-exempt bonds 1,000 Interest income from tax-exempt bonds 3,000 Federal income taxes 55,400 MACRS depreciation (used for taxable income) in excess of E&P depreciation 1,500George, the sole shareholder in Fall Inc. (a C corporation), has a $60,000 tax basis in his stock. Fall has $40,000 of accumulated positive earnings and profits (E&P) at the beginning of the year, and $10,000 of current positive E&P for the current year. At year end, Fall distributed land with a fair market value (FMV) of $38,000 to George. The land has an outstanding mortgage of $3,000 that George must assume. 

What is George's tax basis in the land?