Exercise 13-26 (LO. 1) Sally owns real property for which the annual property taxes are $9,000. She sells the property to Kate on March 9, 2019, for $550,000. Kate pays the real property taxes for the entire year on October 1, 2019. Assume a 365-day year. Round any division to four decimal places. Round your final answers to the nearest dollar. a. How much of the property taxes can be deducted by Sally and how much by Kate? Sally can deduct $ 1,652 and Kate can deduct $ 7,348 of the property taxes. Feedback 7 Chook My Work The term sale or other disposition is defined broadly in the tax law and includes virtually any disposition of property. Realized gain the difference between the amount realized from the sale or other disposition of property and the property's adjusted basis on the disposition. b. What effect does the property tax apportionment have on Kate's adjusted basis in the property? Kate's adjusted basis for the property is increased by the s she paid that is apportioned to Sally Feedback Check My Work Check My Work Next > Calculdu Print Item Check My Work Partially correct c. What effect does the apportionment have on Sally's amount realized from the sale? Sally paid none of the real property taxes and is amount realized is increased by this amount. permitted to deduct the apportioned share of x . Her Feedback Check My Work Partially correct d. How would the answers in parts (b) and (c) differ if Sally paid the taxes? If Sally paid the taxes, Sally's amount realized would be $ $ 542,652 542,652 . Kate's adjusted basis would be Feedback 7 Check My Work Corrent