All of the following transactions are exempt from rules regarding imputed interest with the exception of
A) taxpayer purchases newly issued bond for $700 (face value of $1,000).
B) taxpayer sells land for $135,000 with payment due in 5 years and no stated interest.
C) taxpayer sells his home gym equipment for $2,800 with payment due in one year and no stated interest.
D) taxpayer purchases a sailboat costing $2,500 for weekend boating trips; the full price payable in five months and no stated interest.
A) taxpayer purchases newly issued bond for $700 (face value of $1,000).
Debt subject to original issue discount provisions, sales of property for $3,000 or less, and sales where all of the payments are due within six months are exempt from the imputed interest rules.
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