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19 October, 12:21

George and Barbara moved from Washington, D. C. to Texas where they purchased a new house for $1,000,000. They had lived in their old house for 8 years before selling it for $800,000. They had purchased it for $400,000. What is George and Barbara's taxable gain and what is their basis in their new house

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  1. 19 October, 12:26
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    Answer:George and barbara's taxable gain=$400000

    Explanation: taxable gain = sale price - purchase price

    Sale price price = $800,000

    Purchase price = $400,000

    Taxable gain = $800000-$400000=$400000

    Taxable gain for old house = $400000

    Selling price for the new house (basis) = $1000000+$400000=$1400000
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