Question 19 of 65. Joseph purchased a home for $275,000. Legal fees for the purchase were $500 and recording fees were $280. Later, he added a room for $25,000. During a storm, he suffered damage and spent $1,000 on repairs to restore the property. Two months later, he received a check from his insurance company for $500 for the storm damage. Which of the following is true? His basis is: Still $275,780, the cost of the house along with the legal and recording fees. $300,000, because of the room addition. $301,280. Legal and recording fees, the cost of the room addition, and the cost of repairs are added to the purchase price The insurance payment is deducted from the basis $301,780 because insurance proceeds do not affect basis. Mark for follow up