Questions from Federal Taxation

Q: Locate IRS Form 2120 (at ,vww.irs.gov

Locate IRS Form 2120 (at ,vww.irs.gov), and answer the following questions. a. Who must sign the form? b. Who must file the form? c. Can it be used for someone who is not related to the taxpayer? Ex...

Q: George is the owner of numerous classic automobiles. His intention is

George is the owner of numerous classic automobiles. His intention is to hold the automobiles until they increase in value and then sell them. He rents the automobiles for use in various events (e.g.,...

Q: Eagle Partners meets all of the requirements of§ 1237 (subdivided

Eagle Partners meets all of the requirements of§ 1237 (subdivided realty). In 2018, Eagle Partners begins selling lots and sells four separate lots to four different purchasers. Eagle Partners also se...

Q: Benny purchased $400,000 of Peach Corporation face value bonds

Benny purchased $400,000 of Peach Corporation face value bonds for $320,000 on November 13, 2017. The bonds had been issued with $80,000 of original issue discount because Peach was in financial diffi...

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 2016. Raymond was an investor in vacant land. He thought Carla's land might be the site of a...

Q: Sam owns 1,500 shares of Eagle, Inc., stock

Sam owns 1,500 shares of Eagle, Inc., stock that he purchased over 10 years ago for $80,000. Although the stock has a current market value of $52,000, Sam still views the stock as a solid long-term in...

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

Abby's home had a basis of $360,000 ($160,000 attributable to l11e 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: Freys, Inc., sells a 12-year franchise to Reynaldo

Freys, Inc., sells a 12-year franchise to Reynaldo. The franchise contains many restrictions on how Reynaldo may operate its store. For instance, Reynaldo cannot use less than Grade 10 Idaho potatoes;...

Q: Maria held vacant land that qualified as an investment asset. She

Maria held vacant land that qualified as an investment asset. She purchased the vacant land on April 10, 2014. She exchanged the vacant land for a rental house in a qualifying like-kind exchange on Ja...

Q: Dennis sells short 100 shares of ARC stock at $20 per

Dennis sells short 100 shares of ARC stock at $20 per share on January 15, Digging Deeper 2018. He buys 200 shares of ARC stock on April 1, 2018, at $25 per share. On May 2, 2018, Dennis closes the sh...