Peter Paulson purchased a residence on February 19, 2010 for $180,000. On September 7, 2012, a tornado completely destroyed their home. fte home was insured for its replacement value and homes in Peter's area had appreciated greatly. He received proceeds of $420,000. How much does Peter include?
A) $250,000
B) $240,000
C) $-0-
D) $420,000
E) None of the above

Question

Quizplus · Accepted Answer

Peter does not recognize any of the $240,000 realized gain on the involuntary conversion of his home by the tornado because it is less than the $250,000 exclusion allowed for an individual.

Peter Paulson Purchased a Residence on February 19, 2010 for $180,000