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Drake and Cynthia Sell Their Home for $475,000, Incurring Selling

Question 16

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Drake and Cynthia sell their home for $475,000, incurring selling expenses of $20,000. They had purchased the residence in 1998 for $105,000 and made capital improvements totaling $25,000. They buy a new residence for Drake and Cynthia sell their home for $475,000, incurring selling expenses of $20,000. They had purchased the residence in 1998 for $105,000 and made capital improvements totaling $25,000. They buy a new residence for $210,000. What is their realized gain and recognized gain on the sale? What is their basis in the new house? $210,000. What is their realized gain and recognized gain on the sale? What is their basis in the new house?

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