In 2022, taxpayer (TP) has land that was condemned by eminent domain. TP owned this land for more than one year. The condemned land cost TP $200,000. In October of 2022, TP received $400,000 in eminent domain proceeds. In December of 2022, TP acquired replacement land at a cost of $350,000. Which of the following, if any, is correct?

TP has gain realized of $400,000; gain recognized of $200,000.

TP has gain realized of $200,000; gain recognized of $400,000.

TP has gain realized of $50,000; gain recognized of $50,000.

TP has gain realized of $200,000; gain recognized of $50,000

None of the other choices are correct.