Questions from Federal Taxation

Q: Vito is the sole shareholder of Vito 1nc. He is also

Vito is the sole shareholder of Vito 1nc. He is also employed by the corporation. On June 30, 2018, Vito borrowed $8,000 from Vito, Inc., and on July 1, 2019, he borrowed an additional $10,000. Both l...

Q: Trip Garage, Inc. (459 Ellis Avenue, Harrisburg,

Trip Garage, Inc. (459 Ellis Avenue, Harrisburg, PA 17111), is an accrual basis taxpayer that repairs automobiles. In late December 2018, the company repaired Samuel Mos1ey's car and charged him $1,00...

Q: Freda is a cash basis taxpayer. In 2018, she negotiated

Freda is a cash basis taxpayer. In 2018, she negotiated her salary for 2019. Her employer offered to pay her $21,000 per month in 2019 for a total of $252,000. Freda countered that she would accept $1...

Q: In 2018, Alva received dividends on her stocks as follows:

In 2018, Alva received dividends on her stocks as follows: a. Alva purchased the Grape stock three years ago, and she purchased the Amur stock two years ago. She purchased the Blaze stock 18 days be...

Q: Liz and Doug were divorced on December 31, 2018, after

Liz and Doug were divorced on December 31, 2018, after 10 year of marriage. Their current year’s income received before the divorce was on follows: Allocate the income to Liz and D...

Q: Linda and Don are married and filed a joint return. In

Linda and Don are married and filed a joint return. In 2018, they received $12,000 in Social Security benefits and $35,000 in taxable pension benefits and interest. a. Compute the couple's adjusted gr...

Q: Nell and Kirby are in a process of negotiating their divorce agreement

Nell and Kirby are in a process of negotiating their divorce agreement to be finalized in 2018. What should be the tax consequences to Nell and Kirby if the following, considered individually, became...

Q: Euclid acquires a 7-year class asset on May 9,

Euclid acquires a 7-year class asset on May 9, 2018 for $80,000. Euclid does not elect immediate expensing under 179. She does not claim any available additional first -year depreciation. Calculate Eu...

Q: Ridge is a generous individual. During the year he made interest

Ridge is a generous individual. During the year he made interest free loans to various family members when the Federal rate was 3%. What are the tax consequences of the following loans by Ridge: a. On...

Q: Sally was an all-state soccer player during her junior and

Sally was an all-state soccer player during her junior and senior years in high school. She accepted an athletic scholarship from State University. The scholarship provided the following: a. Determi...