Jay-Z owns land that he received from his father 10 year ago as a gift. The land was purchased by his father in 1984 and was worth $20,000 at the time of gift. Jay-Zs father did not owe gift taxes upon making the transfer. The property is currently worth about $80,000. Jay-Z is considering selling the land and purchasing a piece of undeveloped property in the mountains.

Jay-Z also owns 800 shares of Microsoft stock. 300 of which were acquired as an inheritance when his grandfather died in 1997. Jay-Zs grandfather paid $12,000 for the shares, and the shares were worth $40,000 at the time of his death. The other 500 shares of Microsoft stock were purchased by Jay-Z fourteen months ago for $60,000. The stock is currently worth $130 per share and Jay-Z is considering selling the shares.

In addition, Jay-Z owns a house that he inherited from his grandmother five years ago. His grandmother lived in the house for over 50 years. A developer has recently offered Jay-Z $800,000 for the house. His grandmother purchased the house for $20,000 and at the time of her death, the house was worth $500,000.

The building Jay-Z used in his music business was destroyed by fire on October 5, 2017. Fortunately the building was insured for $220,000. Jay-Z purchased the building for $25,000 and added capital improvements of 60,000, a month after purchase. The insurance company has agreed to reimburse Jay-Z the full insurance amount. Jay-Z intends to use the proceeds to purchase another building for his music business for $120,000 and to pay off his loans, which amounts to $100,000.

Jay-Z purchased a land from Beyonce on 1/1/2017 for $400,000. He would like to sell the land on 12/31/2017 for $500,000.

You are a well-known accountant in Beverly Hills. Jay-Z seeks your tax advice on all of these transactions.