As part of a divorce decree, Janet must give her ex-spouse Herman her half-interest in stock with a total value of $120,000 (total basis = $70,000) in exchange for his half-interest in their home with a total value of $150,000 and a basis of $130,000. What are Janet and Herman's realized and recognized gains or losses on this exchange? Janet: Realized Recognized Herman: Realized Recognized
a. $30,000 $30,000 ($20,000) ($20,000)
b. $30,000 0 $20,000 0
c. $40,000 0 ($5,000) 0
d. $40,000 $10,000 ($5,000) ($5,000)
e. None of the above