Under the Terms of a Property Settlement Executed During the Current

question 130

Essay

Under the terms of a property settlement executed during the current year, Cindy transferred a house worth $350,000 to her ex-husband, Carl. The property has a tax basis to Cindy of $300,000.
a.How much taxable gain or loss must be recognized by Cindy at the time of the transfer?
b.What is Carl's tax basis in the property he received from Cindy?

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Definitions:

Locard's Exchange Principle

A principle in forensic science that states every contact leaves a trace, meaning a criminal will always bring something into the crime scene and leave with something from it.

Cellulose

A complex carbohydrate or polysaccharide that forms the main structure of plant cell walls and is used in the production of paper, textiles, and various bioproducts.

Sheep Wool

The soft, thick, curly hair that grows on sheep, used extensively in textiles for clothing, blankets, and other products.

Blueprint

A detailed technical drawing or plan for designing buildings, machines, or any structure, traditionally rendered in white lines on a blue background.