Question 3. 3. (TCO 6) Which of the following is correct? (Points : 2) The gain

Question

Question 3. 3. (TCO 6) Which of the following is correct? (Points : 2)

       The gain basis for property received by gift is the lesser of the donor's basis or the fair market value on the date of the gift.
       The loss basis for property received by gift is the same as the donor's basis.
       The gain basis for inherited property is the same as the decedent's basis.
       The loss basis for inherited property is the lesser of the decedent's basis or the fair market value on the date of the decedent's death.
       None of the above

Question 3. 3. (TCO 6) Which of the following is correct? (Points : 2)

Explanation / Answer

"Double Basis Rule"
For property sold with gains - use adjusted basis of donor
For property sold with losses - use the FMV of the property

Therefore, Option D is correct

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