On January 1, 2012, Daniel Durrow owned rental property which had an adjusted basis to him of $250,000. Daniel made the following expenditures during 2012:
A) $225,000
B) $240,000
C) $260,000
D) $275,000
E) None of the above

Question

On January 1, 2012, Daniel Durrow owned rental property which had an adjusted basis to him of $250,000. Daniel made the following expenditures during 2012: 
A) $225,000 
B) $240,000 
C) $260,000 
D) $275,000 
E) None of the above

Quizplus · Accepted Answer

Daniel's basis in the rental property must be adjusted to take into account the cost of improvements and other charges such as legal expenses. ftus, $250,000 adjusted basis + $10,000 legal fees + $15,000 assessment for local street improvements that increased the value of the property = $275,000. the ordinary painting and the roof repair were not improvements to the property.

On January 1, 2012, Daniel Durrow Owned Rental Property Which