Question
I only need answer for part 2 please Part 1 Karimaghaya purchased the residence on March 23, 1997, for $129,400 and improvements totaling $5,700 since.
I only need answer for part 2 please
Part 1
- Karimaghaya purchased the residence on March 23, 1997, for $129,400 and improvements totaling $5,700 since. The original loan has a balance as of January 1, 2020 of $95,200 (principal payments for 2020 are $750) and bears interest at 4 percent. Property taxes for 2020 are $3,400. s other income and expenses for 2020 are these:
Salaries and wages $140,800
State income taxes 6,400
State car tax 225
State sales tax 4,220
Other itemized deductions 3,100
- Carolines after-tax cost of owning the residence for 2020. Assume that Carolines marginal tx bracket is 22%.
Part 2
Caroline Karimaghaya from Part 1 sold her principal residence March 16, 2020, for $435,000. Related to the sale, Caroline paid the following:
Sales commissions $13,325
Title transfer, legal, etc. 225
Prepayment penalty on loan 1,220
Painting and other cleanup (January 19) 450
- buyer paid Caroline $256 for property taxes she had paid which were allocable to the period after the sale.
- replaced the residence on January 22, 2021. She paid $258,000 and made other payments at closing as follows:
Points on new mortgage $ 800
Closing costs 330
Property tax reimbursement to seller 560
Calculate Carolines gain realized and gain recognized on the s
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