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Sheena Maskell Sheena Maskell
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7 years ago
Nick sells stock of a non-publicly traded corporation with a $7,000 adjusted basis for $10,000. Nick receives a $2,000 down payment with the balance of $8,000 due the following year. Nick is unable to collect the remaining $8,000 and, after incurring legal fees of $500, he repossesses the stock when it has a fair market value of $9,000.
a.   What is the amount of gain that Nick must report in the first year?
b.   What is the amount of gain that Nick must report in the second year?
c.   What is the basis in the repossessed stock?
Textbook 
Prentice Hall's Federal Taxation: 2011: Individuals

Prentice Hall's Federal Taxation: 2011: Individuals


Edition: 14th
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MsLippyMsLippy
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