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Question
Bobby owned a building with a fair market value of $2,000,000. Bobby’s adjusted basis in the building was $1,000,000. Bobby agreed to sell the building to his son, Robby, for $1,300,000. What is the amount of Bobby’s taxable gift?
A.Bobby has made a taxable gift of $300,000.
B.Bobby has made a taxable gift of $682,000.
C.Bobby has made a taxable gift of $2,000,000.
D.Bobby has not made a taxable gift.