Sidney Owns a Residential Rental Property with an Adjusted Basis

question 126

Multiple Choice

Sidney owns a residential rental property with an adjusted basis of $200,000 at the beginning of the current year.The county treasurer sends Sidney a tax bill payable by December 31.The bill is for real estate property taxes of $1,200 for the current calendar year and for a $6,000 special assessment for a new sewer line.On November 1,Sidney sells the property to Donald for $225,000.As part of the sale contract,Sidney will pay the real estate taxes of $1,200 at closing and Donald agrees to pay the special assessment of $6,000 on the due date.What is Sidney's gain on the sale?

• A)$19,800
• B)$20,000
• C)$21,000
• D)$24,800
• E)$29,800

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Definitions:

Acetyl-CoA

A molecule involved in metabolism that conveys the carbon atoms within the acetyl group to the citric acid cycle to be oxidized for energy production.

Lipogenesis

The metabolic process of synthesizing fatty acids from acetyl-CoA, primarily occurring in the liver and adipose tissue.

Absorptive State

The metabolic phase following a meal when nutrients from the food are absorbed from the intestinal tract into the bloodstream.

Triglycerides

A type of fat (lipid) found in your blood, used by the body for energy, and an indicator of metabolic health.