George receives an apartment complex as a gift from his father

George receives an apartment complex as a gift from his father

Part 1: George receives an apartment complex as a gift from his father. The father’s basis for the apartment complex and land is $95,000. At the time of the gift, the land and building have FMVs of $45,000 and $85,000, respectively. No gift tax is paid by George’s father at the time of the gift.

Part 1: George receives an apartment complex as a gift from his father

Part 1: George receives an apartment complex as a gift from his father. The father’s basis for the apartment complex and land is $95,000. At the time of the gift, the land and building have FMVs of $45,000 and $85,000, respectively. No gift tax is paid by George’s father at the time of the gift.

Firstly, To determine gain, what is George’s basis for the land?

Secondly,  To determine gain, what is George’s basis for the building?

Thirdly, Will the basis of the land and building be the same as in Parts 1 and 2 for purposes of determining a loss?

Part 2:

Fred received 200 shares of Georgia Corporation stock from his brother as a gift on July 20, 2017, when the stock had a $44,000 FMV. His brother paid $30,000 for the stock on April 12, 2002. The taxable gift was $44,000, because his brother made another gift to Fred for $20,000 in January and used the annual exclusion. The brother paid a gift tax of $1,500. Without considering the transactions below, Fred’s AGI is $43,000 in 2018. No other transactions involving capital assets occur during the year. Analyze each transaction below, independent of the others, and determine Fred’s AGI in each case.

Firstly, He sells the stock on October 12, 2018, for $48,000.

Secondly,  He sells the stock on October 12, 2018, for $28,000.

Thirdly, He sells the stock on December 16, 2018, for $42,000.

Part 3:

John receives 400 shares of A&M Corporation stock from his aunt on May 20, 2018, as a gift when the stock has a $66,000 FMV. His aunt purchased the stock in 2008 for $46,000. The taxable gift is $61,000 because she made earlier gifts to John during 2018 and used the annual exclusion. She paid a gift tax of $9,300 on the gift of A&M stock to John. John also inherited 300 shares of Longhorn Corporation preferred stock when his uncle died on November 12, 2017, when the stock’s FMV was $31,000. His uncle purchased the stock in 1996 for $27,600. Determine the gain or loss on the sale of A&M and Longhorn stock on December 15, 2018, under each alternative situation below.

Firstly,  A&M stock was sold for $62,600, and Longhorn stock was sold for $30,750.
Secondly, A&M stock was sold for $58,200, and Longhorn stock was sold for $28,650.

Laslty,  Assume the same as in Part 1 except his aunt purchased A&M stock for $71,000 and his uncle purchased Longhorn stock for $31,200.