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Sadie gave her granddaughter, Alice, some Lock Co. stock last year when its fair market value was $25,000. Sadie acquired the stock in 2004 at

Sadie gave her granddaughter, Alice, some Lock Co. stock last year when its fair market value was $25,000. Sadie acquired the stock in 2004 at a cost of $35,000. Alice sold the Lock Co. stock this year for $32,000. What are the tax consequences for Alice this year?

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