# FIN – During the current year, Ron sells a tract of land for \$700,000

During the current year, Ron sells a tract of land for \$700,000. The property was received as a gift from Lillian on March 10, 1995, when the property had a \$210,000 FMV. The taxable gift was \$200,000 because the annual exclusion was \$10,000 in 1995. Lillian purchased the property on April 12, 1980, for \$70,000. At the time of the gift, Lillian paid a gift tax of \$14,000. In order to sell the property, Ron paid a sales commission of \$11,000.Required:a. what is Ronâs realized gain on the sale. (Show all calculations) b. How would your answer to Part a. change, if at all, if the FMV of the gift property was \$45,000 as of the date of the gift?
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# FIN – During the current year, Ron sells a tract of land for \$700,000

During the current year, Ron sells a tract of land for \$700,000. The property was received as a gift from Lillian on March 10, 1995, when the property had a \$210,000 FMV. The taxable gift was \$200,000 because the annual exclusion was \$10,000 in 1995. Lillian purchased the property on April 12, 1980, for \$70,000. At the time of the gift, Lillian paid a gift tax of \$14,000. In order to sell the property, Ron paid a sales commission of \$11,000.Required:a. what is Ronâs realized gain on the sale. (Show all calculations) b. How would your answer to Part a. change, if at all, if the FMV of the gift property was \$45,000 as of the date of the gift?
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