Jerry acquires a multifamily property for $6,000,000. The terms of the purchase were $1,600,000 in cash and the balance was financed through a $4,400,000 resource mortgage. Due to substantial vacancies, Jerry was unable to meet debt service payments. At the time of the default, the mortgage balance was $7,000,000 (mortgage was refinanced). The fair market value of the property was $5,500,000 and it had an adjusted basis of $5,200,000. (Accumulated depreciation is $800,000) Calculate the tax liability associated with the foreclosure?