Bernice sells her house to John on August 1 for $500,000, cash. The yearly real estate taxes (Jan. 1 - Dec. 31) are $12,000 and John pays the entire $12,000 on December 31. Assuming that both Bernice and John itemize their deductions how much will they each deduct with respect to the $12,000 paid by John? What will the selling price and the purchase price be of the house be for federal income tax purposes?

Bernice sells her house to John on August 1 for $500,000, cash. The yearly real estate taxes (Jan. 1 - Dec. 31) are $12,000 and John pays the entire $12,000 on December 31. Assuming that both Bernice and John itemize their deductions how much will they each deduct with respect to the $12,000 paid by John? What will the selling price and the purchase price be of the house be for federal income tax purposes?

Income Tax Fundamentals 2020

38th Edition

ISBN:9780357391129

Author:WHITTENBURG

Publisher:WHITTENBURG

Chapter5: Deductions For And From Agi

Section: Chapter Questions

Problem 18P: Mike sells his home to Jane on April 2,2019 . Jane pays the property taxes covering the full...

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