Using the following scenario construct a memo to your client using the format you learned in BPA $262.$ You will need to give specific code section references as appropriate when answering your questions. Assume your client knows nothing about tax law and you are trying to educate him as to why certain transactions require certain treatments.Scenario for $2023$ tax year:John Little who is single is a new client of yours that has come to you with several tax issues with which he needs your help. He is an engineer that has his own practice for which he files a Schedule C and has net income from that of $$165,000$ for $2023.$ In addition, he inherited some stock from his mother about $10$ years ago for which she paid $$4,000,$ but at her date of death it was worth $$25,000.$ John sold the stock for $$42,000$ in $2023.$ Additionally, a friend gifted him a Manet painting valued at $$500,000$ on June $1,2019($date of gift$),$ but for which his friend paid nothing as it was inherited from his great grandmother in $1990.$ His friend has an appraisal for the painting at the time of his great grandmothers death and the value of the painting at her date of death was $$200,000.$ John is thinking of selling the painting in $2023,$ but wants your advice as to whether he should sell it this year or next. $($Note: John will probably have net income from his business of about $$50,000$ in $2024$ because he plans to backpack through Europe for about nine months in $2024.)$ During $2023$ John also sold a machine for $$6,000$ that he used in his engineering company that had an original cost of $$32,000$ and accumulated depreciation of $$32,000.$ His final question to you relates to the house he lives in which he has maintained as his principal residence since $2005.$ He is thinking about renting out his house for $2024$ while he is in Europe and then selling it in $2025$ when he returns. He paid $$125,000$ for the house and put in a recreation room and new kitchen for a cost of $$60,000.$ In addition, he has had the interior and exterior recently painted for a cost of $$12,000.$ He thinks he can sell the house for $$400,000$ in $2025.$ John wants to know the following: What impact do each of the above transactions have on his tax returns for $2023,2024$ and $2025?$ Please refer to specific code sections of the Internal Revenue Code, if appropriate. Calculate Johns taxable income for $2023$ and what the tax liability would be given the facts surrounding the $2023$ tax year. Please show your calculation to receive full credit.Required:Your project should be in the form of a client memo which should be at least two pages in length.You should use Calibri $12$ font and double spaced when preparing the memo.Please make sure you address all of the tax situations mentioned. Please refer to the rubric for specific points for the project.