Adam Purchased Stock in 2006 for $100,000

question 41

Essay

Adam purchased stock in 2006 for $100,000.He is considering selling it in 2016.It is currently worth $2,100,000 so he would realize a $2,000,000 gain.Adam is in the top tax bracket.Determine the taxes due under the following independent situations (ignore any additional Medicare taxes on investment income):
(a)Adam sells the stock,and no special circumstances apply.
(b)The stock is qualified small business corporation stock.
(c)The stock is qualified small business corporation stock.Within 60 days Adam invests $2,500,000 in new qualifying small business corporation stock.
(d)The stock is qualified small business corporation stock.Within 60 days Adam invests $2,000,000 in new qualifying small business corporation stock.

---

Definitions:

Mathematics

The abstract science of number, quantity, and space, either as abstract concepts (pure mathematics), or as applied to other disciplines such as physics and engineering (applied mathematics).

Mechanics

The branch of physics concerned with the motion of objects and the forces that cause this motion; also refers to the skilled trade of working with machinery.

Yellow Fever Epidemic

A severe outbreak of Yellow Fever, a viral disease transmitted by mosquitoes, which killed thousands in multiple instances throughout history, particularly in densely populated areas.

Plunder

The act of robbing goods by force, especially during war or conflict, often associated with pillaging.