Oscars rental home (AB of home, excluding land = $100,000 ; FMV of home, excluding land = $500,000 ) was completely destroyed in a fire . Oscar had the home insured for its FMV. As a result, Oscar received insurance proceeds of $500,000. Oscar then used $ 450 ,000 of the proceeds to build a replacement property . Oscar used the other $50,000 of proceeds to pay off his student loans.

23. What is O scars recognized gain or loss if Oscar elects nonrecognition where possible ?

Note: you should calculate realized gain/loss first, but the question asks only for recognized gain/loss. Note: understand how Oscar could avoid recognizing any gain on re ceipt of the insurance proceeds

24. What is Oscars basis in the replacement property if Oscar elects nonrecognition where possible?