Bobby and Betty Bennett sold for $450,000 in October of 2012 their residence that they had purchased in 2002 for $200,000. ftey made major capital improvements during their 10-year ownership totaling $40,000. What is their recognized gain?

Question

Quizplus · Accepted Answer

the Bennetts' basis of the residence at the time of the sale is $240,000 and their realized gain is $210,000 ($450,000 less $240,000). the y may exclude the total $210,000 realized gain and therefore they have no recognized gain.

Bobby and Betty Bennett Sold for $450,000 in October of 2012