Questions from Federal Taxation

Q: Andy owns an appliance store where he has merchandise such as refrigerators

Andy owns an appliance store where he has merchandise such as refrigerators for sale. Roger, a bachelor, owns a refrigerator, which he uses in his apartment for personal use. For which individual is t...

Q: Lee and Jane have been your firm’s clients for most of the

Lee and Jane have been your firm’s clients for most of the twenty years they have been married. Recently Lee came to you and said that he and Jane are obtaining a divorce, and he wants you to help him...

Q: Under what circumstances may a taxpayer deduct an illegal bribe or kickback

Under what circumstances may a taxpayer deduct an illegal bribe or kickback?

Q: For the following independent situations, determine the optimum filing status for

For the following independent situations, determine the optimum filing status for the years in question. a. Wayne and Celia had been married for 24 years before Wayne died in an accident in 2015. Cel...

Q: The PDQ Partnership earned ordinary income of $150,000 in

The PDQ Partnership earned ordinary income of $150,000 in 2017. The partnership has three equal partners, Pete, Donald, and Quint. Quint, who is single, uses the standard deduction, and has other inco...

Q: Which of the following would likely be a constructive dividend?

Which of the following would likely be a constructive dividend? a. An unreasonable salary paid to a shareholder. b. An unreasonable salary paid to the daughter of a shareholder. c. A sale of a corp...

Q: USA Corporation hired Jesse to install a computer system for the company

USA Corporation hired Jesse to install a computer system for the company and paid him $8,000 for the work. USA soon realized that there were problems with the system and asked Jesse to refund the paym...

Q: Why did the Supreme Court rule in the Corn Products case that

Why did the Supreme Court rule in the Corn Products case that a gain due to the sale of futures contracts is ordinary income instead of capital gain?

Q: Kathleen owns 500 shares of Buda Corporation common stock which was purchased

Kathleen owns 500 shares of Buda Corporation common stock which was purchased on March 20, 1999, for $48,000. On October 10 of the current year, she receives a distribution of 500 stock rights. Each s...

Q: What is the statute of limitations for transactions involving: a

What is the statute of limitations for transactions involving: a. Fraud (e.g., failure to file a tax return) b. Disallowance of tax deduction items c. The omission of rental income that is greater t...