Questions from Federal Taxation

Q: Emily has $100,000 that she wants to invest and

Emily has $100,000 that she wants to invest and is considering the following two options: • Option A: Investment in Redbird Mutual Fund, which is expected to produce interest income...

Q: Pat is 40, is single, and has no dependents.

Pat is 40, is single, and has no dependents. She received a salary of $390,000 in 2021. She earned interest income of $11,000, dividend income of $15,000, gambling winnings of $14,000, and interest in...

Q: Renee and Sanjeev Patel, who are married, reported taxable income

Renee and Sanjeev Patel, who are married, reported taxable income of $1,008,000 for 2021. They incurred positive AMT adjustments of $75,000 and tax preference items of $67,500. The couple itemizes the...

Q: Kristin Graf (123 Baskerville Mill Road, Jamison, PA 18929

Kristin Graf (123 Baskerville Mill Road, Jamison, PA 18929) is trying to decide how to invest a $10,000 inheritance. One option is to make an additional investment in Rocky Road Excursions in which sh...

Q: Lynn, age 45, is single and has no dependents.

Lynn, age 45, is single and has no dependents. Her income and expenses for 2021 are reported as follows. Income— Salary ……………………………………………………………………………….$233,000 Taxable interest on corporate bonds……………...

Q: A number of years ago, Lee acquired a 20% interest

A number of years ago, Lee acquired a 20% interest in the BlueSky Partnership for $60,000. The partnership was profitable through 2020, and Lee’s amount at risk in the partnership interest was $120,00...

Q: Alfred is single, and his AMTI of $1,850

Alfred is single, and his AMTI of $1,850,000 consists of the following amounts. What tax rates are applicable in calculating Alfred’s TMT? Ordinary income………………………………………………. $1,750,000 Long-term capi...

Q: In the current year, Dylan earned interest from the following investments

In the current year, Dylan earned interest from the following investments. Investment ……………………………………………………………………………..Interest Income 10-year municipal bond (issued in 2009) ……………………………………………….$1,300 1...

Q: Archie runs a small mineral exploration business (as a sole proprietorship

Archie runs a small mineral exploration business (as a sole proprietorship). In 2019, he purchased land (for $68,000) where he suspected a magnesium deposit was located. He incurred $18,000 of explora...

Q: Five years ago Gerald invested $150,000 in a passive

Five years ago Gerald invested $150,000 in a passive activity, his sole investment venture. On January 1, 2020, his amount at risk in the activity was $30,000. His shares of the income and losses were...