Nell sells a passive activity with an adjusted basis of $45,000 for $105,000. Suspended losses attributable to this property total $45,000. The total gain and the taxable gain are:
A) $60,000 total gain? $105,000 taxable gain.
B) $10,000 total gain? $15,000 taxable gain.
C) $60,000 total gain? $0 taxable gain.
D) $60,000 total gain? $15,000 taxable gain.
E) None of the above.

Question

Quizplus · Accepted Answer

The total gain is $60,000 ($105,000 - $45,000 basis). The taxable gain is $15,000 ($60,000 - $45,000 suspended losses). Therefore, the correct answer is D.

Nell Sells a Passive Activity with an Adjusted Basis of $45,000