Question

On November 1, year 1, Jamie (who is single) purchased and moved into her principal residence. In the early part of year 2, Jamie was laid off from her job. On February 1, year 2, Jamie sold the home at a $45,500 gain. She sold the home because she found a new job in a different state. How much of the gain, if any, may Jamie exclude from her gross income in year 2?Multiple Choice$4,550.$31,250.$45,500.$0.

Answer 1

Answer:

correct option is $31,250

Explanation:

given data

home sold gain = $45,500

to find out

gain may Jamie exclude from gross income in year 2

solution

as given November 1 purchase home February 1 sold

so we know here that Maximum exclusion will be

Maximum exclusion = $250,000 × $\frac{3}{24}$

Maximum exclusion = $31,250

so here $31,250 may Jamie exclude from her gross income in year 2

correct option is $31,250