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Diane receives a gift of stock from Mary on January 2 of the current year, when the stock was trading for $20,000. Mary paid $4,000

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Diane receives a gift of stock from Mary on January 2 of the current year, when the stock was trading for $20,000. Mary paid $4,000 for the stock several years ago. Mary pays a gift tax of $500 on the transfer. Diane's basis in the stock is: 1) $4,000 2) $4,400 3) $20,000 4) $20,400

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