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:

Generosity

The quality of being kind and generous, often manifested through the offering of time, resources, or assistance to others without expecting anything in return.

Honesty

The quality of being truthful, transparent, and free from deceit or fraud.

Correctness

The quality of being accurate, free from errors, or in accordance with accepted standards or rules.

Grammar and Punctuation

The set of rules and conventions that govern the structure of sentences and the correct use of symbols in a language.