Olivia received land from her Uncle when he died > the land was purchased by her...
Olivia received land from her Uncle when he died > the land was purchased by her uncle 50years ago for $10,000 . Fair Market Value of the property at the date of his death was 500,000. What is the basis of the property she received ? Is there recognized Gain or Loss ?
Homework Answers
Answer:-
Olivia received Land from her Uncle. There is no Capital Gain tax arise in the hands of Olivia as she received Land as a Gift.
Capital Gain Tax arise when she sold such property to some other person after deducting Fair Market Value of the Property.
Cost of Acquisition shall be the cost to the previous owner i.e Rs. 10,000/- but while calculating Capital Gain Tax we need to consider Fair Market Value of the Land.
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