Questions from General Taxation

Q: Ella owns 60% of the stock of Peach, Inc.

Ella owns 60% of the stock of Peach, Inc. The stock has declined in value since she purchased it five years ago. She is going to sell 5% of the stock to a relative. Ella is also going to make a gift o...

Q: Jarret owns City of Charleston bonds with an adjusted basis of $

Jarret owns City of Charleston bonds with an adjusted basis of $190,000. During the year, he receives interest payments of $3,800. Jarret partially financed the purchase of the bonds by borrowing $100...

Q: Nancy, the owner of a very successful hotel chain in the

Nancy, the owner of a very successful hotel chain in the Southeast, is exploring the possibility of expanding the chain into a city in the Northeast. She incurs $35,000 of expenses associated with thi...

Q: Brittany Callihan sold stock (basis of $184,000)

Brittany Callihan sold stock (basis of $184,000) to her son, Ridge, for $160,000, the fair market value. a. What are the tax consequences to Brittany? b. What are the tax consequences to Ridge if...

Q: For each of the following independent transactions, calculate the recognized gain

For each of the following independent transactions, calculate the recognized gain or loss to the seller and the adjusted basis to the buyer. a. Bonnie sells Parchment, Inc. stock (adjusted basis $17...

Q: In 2015, Gray Corporation, a calendar year C corporation,

In 2015, Gray Corporation, a calendar year C corporation, holds a $75,000 charitable contribution carryover from a gift made in 2010. Gray is contemplating a gift of land to a qualified charity in eit...

Q: Dan Simms is the president and sole shareholder of Simms Corporation,

Dan Simms is the president and sole shareholder of Simms Corporation, 1121 Madison Street, Seattle, WA 98121. Dan plans for the corporation to make a charitable contribution to the University of Washi...

Q: Blue Corporation, a manufacturing company, decided to develop a new

Blue Corporation, a manufacturing company, decided to develop a new line of merchandise. The project began in 2015. Blue had the following expenses in connection with the project. The new product wil...

Q: Jocelyn contributes land with a basis of $60 ,000 and

Jocelyn contributes land with a basis of $60 ,000 and fair market value of $90,000 and inventory with a basis of $5,000 and fair market value of $8,000 in exchange for 100% of Zion Corporation stock....

Q: In 2015, Rose, Inc., has QPAI of $4

In 2015, Rose, Inc., has QPAI of $4 million and taxable income of $3 million. Rose pays independent contractors $500,000. Rose’s W–2 wages are $600,000, but only $400,000 of the wages are paid to empl...