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Residence Cost Basis Amount
Purchase price $ 45,000
Improvements
Residence 28,000
Swimming pool 31,190
Second story addition 16,665
Interior remodeling 1,022
Exterior 3,527
Alarm 825
Closing costs 61,864
Total $188,903
We calculate petitioners’ taxable gain on the sale of the
residence in 2000 to be $101,907 ($790,000 sale price, less
$188,903 cost basis, less $500,000 exemption, equals $101,907
capital gain).
Charitable Deduction for Value of Van
Generally, under section 170(a)(1), a deduction is allowed
for charitable contributions made within the year. See sec.
1.170A-1, Income Tax Regs. The regulations state that the amount
to be allowed for a charitable contribution of property other
than money is to be the “fair market value of the property at the
time of the contribution”. Sec. 1.170A-1(c)(1), Income Tax Regs.
Generally, the best evidence of fair market value is an
actual sale of the property in an arm’s-length transaction within
a reasonable time before or after the valuation date. Berry
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