Tony and Carmela are married. Tony inherited land on his fathers death three years ago. The land is rented by nearby businesses and used as a parking lot. In 2019, the land generated the following income and expenses: Rental income: $5,000 per month Insurance: $900 per month Property taxes: $7,000 annually There is no mortgage on the land. Assume the land is rented throughout the calendar year. The current fair market value of the land is $350,000 and is not expected to change in 2020. Tonys adjusted cost base of the land is $200,000. Tony has always wanted to sell the land ever since he inherited the property, as he does not want to be a landlord. At a family gathering in early 2020, various members of his family expressed that they were interested in purchasing the land from Tony: 1. His Uncle Junior is a shrewd businessman who owns many rental properties. He is retired and told Tony that he is interested in purchasing the land, primarily since there are no maintenance costs. Uncle Junior proposed to purchase the land from Tony at a discounted price of $320,000, since he is offering Tony cash up front and is willing to close the deal in 5 business days. 2. His wife Carmela is begging Tony not to sell the property. She suggested to Tony that he transfer the land to Carmela and she would then look after the tenants. Carmela believes that the land will appreciate in value over the next couple of years since a new shopping centre is under construction across the street. She thinks she wants to sell the property in about 5 years. Carmela does not have as much cash on hand as Uncle Junior, so she has offered Tony $100,000 cash up front and a promissory note of $270,000, bearing interest at the prescribed rate. She promises to pay Tony the interest owing each year by January 20th of the following year. It is now April 2020, and the sale is expected to happen in July 2020. Tony is exploring both options, but he really wants to make Carmela happy, so he will likely take her proposal. However, Tony has reached out to you, CPA, to explain the tax implications under both alternatives in 2020 and in 2021, if any. For Carmelas proposition, Tony wants to know what will happen when she sells the land sometime in the future. Where elections are available, consider the implications with and without the election.