Which of the Following Is/are Correct Regarding the Sale of a Principal

question 94

Multiple Choice

Which of the following is/are correct regarding the sale of a principal residence?
I.A single taxpayer can only use the $250,000 exclusion once every 3 years.
II.Married taxpayers who both meet the ownership and use tests and file jointly can each exclude $250,000 of gain ($500,000 total) on the sale of their principal residence.
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• A)Only statement I is correct.
• B)Only statement II is correct.
• C)Both statements are correct.
• D)Neither statement is correct.

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Definitions:

Inventory Account

An account in the general ledger that tracks the value of a company's products that are intended for sale.

Time Sheet

A document or tool used to track the number of hours worked by an employee during a specific period.

Opening Adjusting Entries

Opening adjusting entries refer to journal entries made at the beginning of an accounting period to adjust account balances from a previous period.

Capital Stock

Represents the equity or ownership sections of a corporation divided into shares.