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24 November, 19:37

Zack received a gift of stock from his uncle on June 20 of the current year. Zack's uncle had a basis in the stock of $4,000, but the fair market value of the stock on June 20 was only $1,500. Zack held the stock for three months and then sold it for $1,200. What basis in the stock will Zack use to determine his gain or loss on the sale of the stock?

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  1. 24 November, 19:56
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    The answer is $1500

    Explanation:

    Since the FMV is lower than the original cost of the gift the dual basis would take place.
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