Terronne told Stephanie that he was considering the sale of two different pieces of property. The first property was a house given to him by his aunt Carliza (in recognition of her A in Federal Tax). At the time of the gift, the house had a FMV of $78,000 and his aunt’s adjusted basis was $100,000. Terronne’s aunt paid gift tax of $12,000 on the house. Archie offer to buy the house from Terronne for $105,000. Terronne also received a tract of land from another aunt via inheritance. The land has an adjusted basis of 27,000 and FMV of 33,000. He has an offer (from Joann) of $39,000.
What would be the gain on each piece of property? Explain your answer.