What is the taxpayer incremental tax on this gain

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Q1. A taxpayer in the 24% marginal tax bracket sold a small apartment building for $310,000 in 2020. The taxpayer purchased the rental real estate during 2017 at a cost of $270,000 and took $22,000 of depreciation deductions to the date of sale. The gain does not move the taxpayer to a different marginal tax bracket. What is the taxpayer's incremental tax on this gain?

Q2. Joe purchased a single-family home for $180,000 in June of 2019. He rehabbed and reconditioned the house for an additional cost of $60,000. He lived in the house during this period and did all of the work himself. In April of 2020, he sold the house for $290,000 himself and received the sales proceeds. What is the tax result of these facts to Joe?

Reference no: EM132963392

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