Questions from General Taxation

Q: Jorge owns two passive investments, Activity A and Activity B

Jorge owns two passive investments, Activity A and Activity B. He plans to dispose of Activity A in the current year or next year. Juanita has offered to buy Activity A this year for an amount that w...

Q: Sarah has investments in four passive activity partnerships purchased several years ago

Sarah has investments in four passive activity partnerships purchased several years ago. Last year, the income and losses were as follows: Activity...

Q: Leon sells his interest in a passive activity for $100,

Leon sells his interest in a passive activity for $100,000. Determine the tax effect of the sale based on each of the following independent facts: a. Adjusted basis in this investment is $35,000. Los...

Q: In the current year, White, Inc., earns $400

In the current year, White, Inc., earns $400,000 from operations and receives $36,000 in dividends and interest from various portfolio investments. White also pays $150,000 to acquire a 20% interest i...

Q: John, an engineer, operates a separate business that he

John, an engineer, operates a separate business that he acquired eight years ago. If he participates 85 hours in the business and it incurs a loss of $34,000, under what circumstances can John claim...

Q: Alice and Jane form Osprey Corporation. Alice transfers property, basis

Alice and Jane form Osprey Corporation. Alice transfers property, basis of $25,000 and fair market value of $200,000, for 50 shares in Osprey Corporation. Jane transfers property, basis of $50,000 and...

Q: Rene retired from public accounting after a long and successful career of

Rene retired from public accounting after a long and successful career of 45 years. As part of her retirement package, she continues to share in the profits and losses of the firm, albeit at a lower r...

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: The end of the year is approaching, and Maxine has begun

The end of the year is approaching, and Maxine has begun to focus on ways of minimizing her income tax liability. Several years ago, she purchased an investment in Teal Limited Partnership, which is s...

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

A number of years ago, Lee acquired a 20% interest in the BlueSky Partner- ship for $60,000. The partnership was profitable through 2014, and Lee’s amount at risk in the partnership interest was $120,...