Yancy's personal residence is condemned as part of an urban renewal project. His adjusted basis for the residence is $480,000.

He receives condemnation proceeds of $460,000 and invests the proceeds in stocks and bonds.

A) calculate yancy's realized and recognized gain or loss.

B) if the condemnation proceeds are $505,000, what are yancy's realized and recognized gain or loss?

C) what are yancy's realized and recognized gain or loss in (a) if the house was rental property?

a. Realised Loss of Yanci's Personal Residence is $20,000. Recognised Loss is Zero

b. Recognised Gain = $25.000

c. the realised gain will be $460.000

Explanation:

A. Realised Gain = Condemnation Proceeds-Adjsuted basis

= $460000-$480000

($20000)

Realised Loss of Yanci's Personal Residence is $20,000. Recognised Loss is Zero

B. Realised Gain in case Condemnation proceeds are $505.000

Realised Gain = $505.000-$480.000

=$25,000

Recognised Gain = $25.000

C. If the House is rental property then the realised gain will be $460.000