Real Estate Math

Vermont's Land Gains Tax rate for land sold within 1 year of purchase is 80% of the gain. A buyer purchased land for $100,000 and sold it 8 months later for $150,000. What is the Land Gains Tax?

A$40,000✓ Correct
B$50,000
C$80,000
D$120,000

Explanation

Gain = $150,000 – $100,000 = $50,000. Land Gains Tax = $50,000 × 80% = $40,000.

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