Questions from Federal Taxation

Q: Terry owns real estate with an adjusted basis of $600,

Terry owns real estate with an adjusted basis of $600,000 and a fair market value of $1.1 million. The amount of the nonrecourse mortgage on the property is $2.5 million. Because of substantial past a...

Q: Norma, who is single and uses the cash method of accounting

Norma, who is single and uses the cash method of accounting, lives in a state that imposes an income tax. In April 2017, she files her state income tax return for 2016 and pays an additional $1,000 in...

Q: Your client, Jacob, turned 66 years old this year.

Your client, Jacob, turned 66 years old this year. Jacob has no heirs and has decided that he would like to sell a life insurance policy to fund a trip to Africa that he has wanted to take. Jacob knew...

Q: Ted and Marvin Brown purchased an apartment building in 2006 as equal

Ted and Marvin Brown purchased an apartment building in 2006 as equal tenants in common. After a hectic decade of co-ownership, the brothers decided that their business association should be terminate...

Q: Shen purchased corporate stock for $20,000 on April 10

Shen purchased corporate stock for $20,000 on April 10, 2015. On July 14, 2017, when the stock was worth $12,000, Shen died and his son, Mijo, inherited the stock. Mijo sold the stock for $14,200 on N...

Q: Coline has the following capital gain and loss transactions for 2017.

Coline has the following capital gain and loss transactions for 2017. Short-term capital gain $....................5,000 Short-term capital loss…………………..(2,100) Long-term capital gain (28%)…………..6,00...

Q: Elliott has the following capital gain and loss transactions for 2017.

Elliott has the following capital gain and loss transactions for 2017. Short-term capital gain $......................1,500 Short-term capital loss……………………(3,600) Long-term capital gain (28%)…………..12...

Q: Paul suffers from emphysema and severe allergies and, upon the recommendation

Paul suffers from emphysema and severe allergies and, upon the recommendation of his physician, has a dust elimination system installed in his personal residence. In connection with the system, Paul i...

Q: Renata Corporation purchased equipment in 2015 for $180,000 and

Renata Corporation purchased equipment in 2015 for $180,000 and has taken $83,000 of regular MACRS depreciation. Renata Corporation sells the equipment in 2017 for $110,000. What is the amount and cha...

Q: Dora incurs the following research expenditures. In-house

Dora incurs the following research expenditures. In-house wages…………………………………...$60,000 In-house supplies…………………………………….5,000 Paid to ABC, Inc., for research services…..80,000 a. Determine the amount...