Question: In 2016, Sam Dealer sold land he had been holding as an investment since 1990 to a buyer who paid him $1,000,000 cash, gave him diamond ring worth $100,000 and took over the responsibility for paying a mortgage of $900.000 which was transferred the land. He had acquired the property in 1984 for $500,000 and spent $100,000 on improvements. His total selling expenses (commissions, transfer taxes, etc._) were $100,000. Mr. Investor had $1,000,000 of income from other sources in 2016
a) What is the Sales Price?
b) What is the Amount Realized?
c) What is the Gain/Loss realized?
d) what is the Gain/Loss recognized?
e) what is the tax liability on the sale of the land?