Tracy Gave Stock with an Adjusted Basis of $18,000 and an FMV

question 88

Multiple Choice

Tracy gave stock with an adjusted basis of $18,000 and an FMV of $15,000 to her nephew Phil. No gift tax was paid. Phil sold the stock for $16,000. The gain or loss Phil will recognize on the sale is

• A)$1,000 gain.
• B)$0.
• C)$1,500 loss.
• D)none of the above

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Definitions:

Carbon-14 Ages

An age estimate of an organic material based on the measurement of the radioactivity of its carbon-14 content.

Granite Intrusion

The penetration of molten granite into pre-existing rocks in the Earth's crust, cooling and solidifying below the surface.

Cross-Cutting Relations

A geological principle stating that rocks disrupted or penetrated by an igneous intrusion or fault are older than the intrusion or fault itself.

Superposition

A principle in geology that states in an undeformed sequence of sedimentary rocks, each layer is older than the one above.