The basis that Jane has from the stock that she has received is therefore 30000 dollars
How to solve for the basis
Stock basis typically refers to the original cost of an asset, primarily stocks or securities, for tax purposes. It is used to calculate capital gains or losses when the asset is sold.
To get the recognized gain, we would have to solve for the difference that exists between the adjusted basis and also the fair market value of what is transferred as the property
Hence we would have
80000 - 50000
= 30000
The basis that Jane has is therefore 30000 dollars
QUESTION
. Jane transfers property with an adjusted basis =
80,000 to Queens Corp. She acquired the property two years earlier. Jane receives all 100 shares of Queens Corp. stock that has a fair market value =10,000 90-day note of the corporation. Jane's recognized gain is: a. 70,000 b. 50,000
16. Assume the same facts as the preceding question. What is Jane's basis in the stock she received?
a. $30,000 b. $10,000 c. $70,000 d. $50,000