Questions from Federal Taxation

Q: Jun records nonrefundable Federal income tax credits of $65,000

Jun records nonrefundable Federal income tax credits of $65,000 for the year. Her regular tax liability before credits is $190,000, and her TMT is $150,000. a. What is Jun’s AMT? b. What is Jun’s regu...

Q: Hakim’s rental building (a $ 1231 asset) was not insured

Hakim’s rental building (a $ 1231 asset) was not insured when it was destroyed by a hurricane. His adjusted basis for the building was substantial but was less than he had paid for the building in 201...

Q: Kite, a calendar year C corporation, incurred a net operating

Kite, a calendar year C corporation, incurred a net operating loss in 2021. Explain Kite’s income tax treatment of this NOL.

Q: Chang and some associates want to form a corporation to develop and

Chang and some associates want to form a corporation to develop and operate an industrial park. Chang is to contribute the land, which has significantly appreciated in value. She would like to recogni...

Q: In late December 2021, Gray (a calendar year C corporation

In late December 2021, Gray (a calendar year C corporation) pledges a $50,000 donation to a local relief agency formed to fight AIDS in Africa. Although Gray’s board of directors authorized the donati...

Q: Nathan uses the percentage of completion method to report income from his

Nathan uses the percentage of completion method to report income from his real estate construction contracts. A contract was begun in 2021 and completed in 2022. In 2021, Nathan reported gross income...

Q: Indicate whether each of the following will increase (1), decrease

Indicate whether each of the following will increase (1), decrease (2), or have no effect (NE) on a partner’s basis in a partnership interest. a. Operating loss of the partnership. b. Capital gains of...

Q: Liana Amiri (single with no dependents) has the following transactions

Liana Amiri (single with no dependents) has the following transactions in 2021: AGI (exclusive of capital gains and losses) ………………………………..$540,000 Long-term capital gain ……………………………………………………………….22,00...

Q: In 2021, Beth Jarow had a $28,000 loss

In 2021, Beth Jarow had a $28,000 loss from the sale of a personal residence. She also purchased a patent on a rubber bonding process from an individual inventor for $7,000 (and resold it in two month...

Q: Phil and Susan Hammond are married taxpayers filing a joint return.

Phil and Susan Hammond are married taxpayers filing a joint return. The couple have two dependent children. Susan has wages of $34,000 in 2020. Phil does not work due to a disability, but he is a buye...