Final answer:
The difference between the amount realized upon the sale or other disposition of a property and the adjusted basis of the property is d) the difference between the amount realized upon sale and the initial cost of the property.
Step-by-step explanation:
The difference between the amount realized upon the sale or other disposition of a property and the adjusted basis of the property is represented by option d) The difference between the amount realized upon sale and the initial cost of the property. For example, let's consider Freda and Ben's houses. Freda bought a house for $150,000 in cash and if she were to sell it now, it would sell for $250,000. The difference between the amount she would realize upon sale ($250,000) and the initial cost of the property ($150,000) is $100,000. Similarly, Ben bought a house for $100,000, and the value of the house has now increased to $160,000. He has paid off $20,000 of the bank loan. The difference between the amount he would realize upon sale ($160,000) and the initial cost of the property ($100,000) is $60,000.