Q3-5

3 Henry owned 10 shares of XYZ Corp. stock for many years. Henry's adjusted basis in the stock was $20/ share. On Oct. 29, 2022, when the share price of XYZ Corp. dropped to $8/ share, Henry sold all 10 shares. On Nov. 1, 2022, Henry purchased 10 shares of XYZ Corp. for $7/ share. What is Henry's realized gain or loss on the Oct. 29 sale of his 10 shares of XYZ Corp.? What is his recognized gain or loss? What is Henry's basis in the 10 shares of XYZ Corp. purchased on Nov. 1 ? How could Henry avoid nonrecognition? Joe exchanged his personal-use residence (House 1. FMV =$600,000 ) with Betty. Joe purchased the residence one year ago for $348,000. Joe paid $2,000 in acquisition costs to purchase the residence. In the exchange, Betty gave Joe a vacation house (House 2, FMV =$600,000 ). Betty originally purchased the vacation house for $100,000. What is Joe's gain or loss realized as a result of the exchange? What is Joe's gain or loss recognized? What is Joe's basis in the vacation house? George purchased a rental house ("House A") in 2002 for $250,000. While George owned the house, George took depreciation deductions totaling $50,000 (assume this is the proper amount). George also made $100,000 worth of capital improvements to the house. In 2022, the rental house is worth $700,000. George exchanges House A for a new rental house ( House B ), also worth $700,000. What is George's realized gain or loss? What is George's recognized gain or loss? What is George's basis in House B