Questions from Federal Taxation

Q: On September 30, Silver Corporation, a calendar year taxpayer,

On September 30, Silver Corporation, a calendar year taxpayer, sold a parcel of land (basis of $400,000) for a $1 million note. The note is payable in five installments, with the first payment due nex...

Q: Sparrow Corporation (a calendar year, accrual basis taxpayer) had

Sparrow Corporation (a calendar year, accrual basis taxpayer) had the following transactions in 2017, its second year of operation. Taxable income………………………………………………………………………………..…..$330,000 Federal i...

Q: Some types of work are counted in applying the material participation standards

Some types of work are counted in applying the material participation standards, and some types are not counted. Discuss and give examples of each type.

Q: In each of the following independent situations, indicate the effect on

In each of the following independent situations, indicate the effect on taxable income and E & P, stating the amount of any increase (or decrease) in each as a result of the transaction. Assume th...

Q: Abby’s home had a basis of $360,000 ($160

Abby’s home had a basis of $360,000 ($160,000 attributable to the land) and a fair market value of $340,000 ($155,000 attributable to the land) when she converted 70% of it to business use by opening...

Q: Black Corporation and Tom each own 50% of Tan Corporation’s common

Black Corporation and Tom each own 50% of Tan Corporation’s common stock. On January 1, Tan has a deficit in accumulated E & P of $200,000. Its current E & P is $90,000. During the year, Tan makes cas...

Q: During a recent Sunday afternoon excursion, Miriam, an admirer of

During a recent Sunday afternoon excursion, Miriam, an admirer of early twentieth-century architecture, discovers a 1920s-era house in the countryside outside Mobile, Alabama. She wants to purchase an...

Q: Complete the following schedule for each case. Unless otherwise indicated,

Complete the following schedule for each case. Unless otherwise indicated, assume that the shareholders have ample basis in the stock investment.

Q: Miguel receives tangible personal property as an inheritance in 2015. The

Miguel receives tangible personal property as an inheritance in 2015. The property was depreciated by the deceased (Miguel’s father), and Miguel will also depreciate it. At the date of the deceased’s...

Q: Larry, the sole shareholder of Brown Corporation, sold his Brown

Larry, the sole shareholder of Brown Corporation, sold his Brown stock to Ed on July 30 for $270,000. Larry’s basis in the stock was $200,000 at the beginning of the year. Brown had accumulated E & P...