Fundamentals of Taxation 2011 4th Edition by Ana Cruz, Debra Prendergast, Dan Schisler, Michael Deschamps

Exercise 36

On January 1, 2009, Myron sells stock that has a $50,000 FMV on the date of the sale (basis $75,000) to his son Vernon for $50,000. On October 21, 2010, Vernon sells the stock to an unrelated party. In each of the following, determine the tax consequences of these transactions to Myron and Vernon:
a. Vernon sells the stock for $40,000.
b. Vernon sells the stock for $80,000.
c. Vernon sells the stock for $65,000.