Questions from Federal Taxation

Q: Early in the current year, Keith meets Dan through a business

Early in the current year, Keith meets Dan through a business associate. Dan tells Keith that he is directing a business venture that purchases poorly managed restaurants in order to turn them around...

Q: Which of the following assets are subject to either amortization, depreciation

Which of the following assets are subject to either amortization, depreciation, or cost recovery? Explain. a. An automobile held for personal use. b. Excess amounts paid in a business combination th...

Q: Rick is a sole proprietor who has a small business currently operating

Rick is a sole proprietor who has a small business currently operating at a loss. He would like to discontinue depreciating the fixed assets of the business for the next few years and to carry the ded...

Q: Rita acquired a personal residence two years ago for $120,

Rita acquired a personal residence two years ago for $120,000. In the current year, she purchases another residence and attempts to sell her former residence. Due to depressed housing conditions in th...

Q: During the current year, Melissa reports AGI of $200,

During the current year, Melissa reports AGI of $200,000. As part of some estate planning, she donates $30,000 to her alma mater, Middle State University, and $65,000 to a private nonoperating foundat...

Q: Daytona Corporation, a manufacturing corporation, acquires the following business assets

Daytona Corporation, a manufacturing corporation, acquires the following business assets in the current year: • Furniture • Plumbing fixtures • Land • Goodwill and a trademark acquired in the acqu...

Q: Robert is a sole proprietor who uses the calendar year as his

Robert is a sole proprietor who uses the calendar year as his tax year. On July 20, 2017 he acquired and placed in service a business machine, a 7-year asset, for $50,000. No other property was acquir...

Q: Goodrich Corporation uses the calendar year as its tax year. It

Goodrich Corporation uses the calendar year as its tax year. It acquires and places into service two depreciable assets during 2017: • Asset #1: 7-year property; $950,000 cost; placed into service on...

Q: Is a deduction allowed under the MACRS rules for depreciable real estate

Is a deduction allowed under the MACRS rules for depreciable real estate (used in a business or held for investment) in the year the property is sold? If so, explain how it is calculated.

Q: Jose is considering acquiring a new luxury automobile costing $45,

Jose is considering acquiring a new luxury automobile costing $45,000 that will be used 100% in his business. The salesperson at the automobile dealership states that Jose will be entitled to substant...