Questions from Federal Taxation

Q: Rex and Agnes Harrell purchased a beach house at Duck, North

Rex and Agnes Harrell purchased a beach house at Duck, North Carolina, in early 2016. Although they intended to use the beach house occasionally for recreational purposes, to help pay the mortgage pay...

Q: Mona viewed herself as a creative individual who had chosen to go

Mona viewed herself as a creative individual who had chosen to go to law school for economic reasons. Mona’s undergraduate majors were creative writing and American Indian studies. Mona was very succ...

Q: In connection with the application of the kiddie tax, comment

In connection with the application of the kiddie tax, comment on the following. a. The child generates only earned income. b. The child reports a modest amount of unearned income. c. The child is age...

Q: During a social event, Muriel and Earl are discussing the home

During a social event, Muriel and Earl are discussing the home computer each recently purchased. Although the computers are identical makes and models, Muriel is surprised to learn that she paid a sal...

Q: During the year, Hernando recorded the following transactions. How should

During the year, Hernando recorded the following transactions. How should Hernando treat these transactions for income tax purposes? • Gain on the sale of stock held as an investment for 10 months. •...

Q: Distinguish between an estate tax and an inheritance tax. a

Distinguish between an estate tax and an inheritance tax. a. Do some states impose both? Neither? b. Which, if either, does the Federal government impose?

Q: Lynn Swartz’s husband died three years ago. Her parents have an

Lynn Swartz’s husband died three years ago. Her parents have an income of over $200,000 a year and want to ensure that funds will be available for the education of Lynn’s 8-year-old son, Eric. Lynn is...

Q: Marcie is divorced, and her married son, Jamie (age

Marcie is divorced, and her married son, Jamie (age 25), and his wife, Audrey (age 18), live with her. During the year, Jamie earned $4,800 from a part-time job and filed a joint return with Audrey to...

Q: Jake (age 72) and Jessica (age 28) were

Jake (age 72) and Jessica (age 28) were recently married. To avoid any transfer taxes, Jake has promised to leave Jessica all of his wealth when he dies. Is Jake under some misconception about the ope...

Q: In assessing the validity of a prior court decision, discuss the

In assessing the validity of a prior court decision, discuss the significance of the following on the taxpayer’s issue: a. The decision was rendered by the U.S. District Court of Wyoming. Taxpayer liv...