If the fair market value $($FMV$)$ of gifted property on the date of the gift is less than the donor's adjusted basis, what is used as the basis if the property is later sold at a loss?

The donor's purchase price.

The lower of the FMV of the property or the donor's adjusted basis, including gift tax paid, on the date of the gift.

The FMV of the property on the date of the gift.

The higher of the FMV of the property or the donor's adjusted basis, including gift tax paid, on the date of the gift.