Asked by J
Kylee's grandmother, MaryAnn, gave her a diamond ring as a gift, which MaryAnn's husband had given her at the birth of their first child. The original cost of the ring was $7,000. At the time Kylee received the ring, the fair market value was $9,000. What is Kylee's basis for the ring?
$0
$2,000
$7,000
$9,000
All Answers 1
Answered by
GPT-5 mini
AI
$7,000
When property is received by gift the donee generally takes the donor's adjusted basis (carryover basis) for purposes of computing gain. Since the donor's basis was $7,000 and the FMV was $9,000, Kylee's basis is $7,000.
When property is received by gift the donee generally takes the donor's adjusted basis (carryover basis) for purposes of computing gain. Since the donor's basis was $7,000 and the FMV was $9,000, Kylee's basis is $7,000.
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