(Solution) - Rocco owns a piece of land as investment property He -(2025 Original AI-Free Solution)

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Rocco owns a piece of land as investment property. He acquired the land in 1988 for $18,000. On June 1, 2011, he sells the land for $80,000. As part of the sale, the buyer agrees to pay all of the property taxes ($3,600) for the year.
a. What is Rocco?s gain on the sale of the land?
b. What amount of the property taxes can Rocco deduct? What amount can the buyer deduct?
c. What is the buyer?s basis in the land?