Questions from Federal Taxation

Q: Paul and Donna Decker are married taxpayers, ages 44 and 42

Paul and Donna Decker are married taxpayers, ages 44 and 42, respectively, who file a joint return for 2017. The Deckers live at 1121 College Avenue, Carmel, IN 46032. Paul is an assistant manager at...

Q: Osprey Corporation, a closely held corporation, has $100,

Osprey Corporation, a closely held corporation, has $100,000 of net active income, $25,000 of portfolio income, and a $120,000 loss from a passive activity. a. How much of the passive activity loss c...

Q: On December 22, 2017, the directors of Partridge Corporation,

On December 22, 2017, the directors of Partridge Corporation, an accrual basis calendar year taxpayer, authorized a cash contribution of $10,000 to the American Cancer Association. The payment is made...

Q: The board of directors of Orange Corporation, a calendar year taxpayer

The board of directors of Orange Corporation, a calendar year taxpayer, is holding its year-end meeting on December 29, 2017. One topic on the board’s agenda is the approval of a $25,000 gift to a qua...

Q: The city of Lawrence recently was hit by a tornado, leaving

The city of Lawrence recently was hit by a tornado, leaving many families in need of food, clothing, shelter, and other necessities. Betty contributed $500 to a family whose home was completely destro...

Q: Gold Corporation, a calendar year C corporation, was formed in

Gold Corporation, a calendar year C corporation, was formed in 2011 and has been profitable until the current year. In 2017, Gold incurs a net operating loss. Identify the issues that Gold Corporation...

Q: Marmot Corporation pays a dividend of $100,000 in the

Marmot Corporation pays a dividend of $100,000 in the current year. Otter Corporation, which is in the 25% marginal bracket, owns 15% of Marmot’s stock. Gerald, an individual taxpayer in the 25% margi...

Q: Emily spent $135,000 to rehabilitate a building (adjusted

Emily spent $135,000 to rehabilitate a building (adjusted basis of $90,000) that originally had been placed in service in 1935. a. Compute Emily’s credit for rehabilitation expenditures. b. How would...

Q: When are C corporations required to make estimated tax payments? How

When are C corporations required to make estimated tax payments? How are these payments calculated?

Q: Schedule M–1 of Form 1120 is used to reconcile financial

Schedule M–1 of Form 1120 is used to reconcile financial accounting net income with taxable income reported on the corporation’s income tax return as follows: Net income per books + Additions ─ Subtra...