Questions from Federal Taxation

Q: Jane and Blair are married taxpayers filing jointly and have 2017 taxable

Jane and Blair are married taxpayers filing jointly and have 2017 taxable income of $97,000. The taxable income includes $5,000 of gain from a capital asset held five years, $2,100 of gain from a capi...

Q: Malcolm owns 60% and Buddy owns 40% of Magpie Corporation

Malcolm owns 60% and Buddy owns 40% of Magpie Corporation. On July 1, 2017, each lends the corporation $30,000 at an annual interest rate of 5%. Malcolm and Buddy are not related. Both shareholders us...

Q: For 2017, Wilma has properly determined taxable income of $36

For 2017, Wilma has properly determined taxable income of $36,000, including $3,000 of unrecaptured § 1250 gain and $8,200 of 0%/15%/20% gain. Wilma qualifies for head-of-household filing status. Comp...

Q: Carla was the owner of vacant land that she was holding for

Carla was the owner of vacant land that she was holding for investment. She paid $2 million for the land in 2015. Raymond was an investor in vacant land. He thought Carla’s land might be the site of a...

Q: How does the earned income credit fit into the Federal government’s plan

How does the earned income credit fit into the Federal government’s plan to fight poverty?

Q: Consuela was a tenant in a campus apartment. She is a

Consuela was a tenant in a campus apartment. She is a student at State University. Her lease began on August 1, 2017, and was due to expire on July 31, 2018. However, her landlord sold the building, a...

Q: What are the maximum postponed gain or loss and the basis for

What are the maximum postponed gain or loss and the basis for the replacement property for the following involuntary conversions?

Q: An individual taxpayer sells some used assets at a garage sale.

An individual taxpayer sells some used assets at a garage sale. Why are none of the proceeds taxable in most situations?

Q: For 2017, Ashley has gross income of $38,350

For 2017, Ashley has gross income of $38,350 and a $5,000 long-term capital loss. She claims the standard deduction. Ashley is 35 years old and unmarried with two dependent children. How much of Ashle...

Q: Gray, Inc., a C corporation, has taxable income from

Gray, Inc., a C corporation, has taxable income from operations of $1,452,000 for 2017. It also has a net long-term capital loss of $355,000 from the sale of a subsidiary’s stock. The year 2017 is the...