Nell and Kirby are in the process of negotiating their divorce agreement. What should be the tax consequences to Nell and Kirby if the following, considered individually, became part of the agreement?
a) In consideration for her acone-half interest in their personal residence, Kirby will transfer to Nell stock with a value of $200,000. Kirby's cost of the stock was $150,000, and the value of the personal residence is $400,000. They purchased the residence three years ago for $300,000.
b) Nell will receive $1,000 per month for the lesser of 120 months or the number of months she lives after the divorce becomes final.
c) Nell is to have custody of their 12-year-old son, Bobby. She is to receive $1,200 per month until Bobby (1) dies or (2) attains age 21 (whichever occurs first). After either of these events occurs, Nell will receive only $300 per month for the remainder of her life.