Problem 4-7 Sale of a Personal Residence (LO 4.6)

Larry Gaines, a single taxpayer, age 42, sells his personal residence on November 12, 2018, for $148,000. He lived in the house for 7 years. The expenses of the sale are $9,000, and he has made capital improvements of $7,000. Larry's cost basis in his residence is $85,000. On November 30, 2018, Larry purchases and occupies a new residence at a cost of $148,000.

Calculate Larry's realized gain, recognized gain, and the adjusted basis of his new residence.

If an amount is zero, enter "0".

a. Realized gain	$
b. Recognized gain	$
c. Adjusted basis of new residence	$