Question: A. Brandy purchased a personal residence in 2006 for $300,000. In 2012, when the preperty's FMV was $275,000, she converted the property to rental property. Assume that 20% of the property's value should be allocated to the land. What is the basis of the house for depreciation?
B. Brandy rents the property for four years, claiming a total of $32,000 of accumulated depreciation. If she sells the property after four years for $310,000, what is the gain on the sale of the land and the gain on the sale of the building? 20% of the property value is still allocable to the land.