Robert Sold His Ranch, Which Was His Principal Residence, During

question 46

Essay

Robert sold his ranch, which was his principal residence, during the current taxable year.At the date of the sale, the ranch had an adjusted basis of $460,000 and was encumbered by a mortgage of $200,000.The buyer paid him
$500,000 in cash, agreed to take the title subject to the $200,000 mortgage, and agreed to pay him $100,000 with interest at 6 percent one year from the date of sale.How much is Robert's realized gain on the sale?

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Definitions:

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