Questions from General Taxation

Q: Elaine Case (single with no dependents) has the following transactions

Elaine Case (single with no dependents) has the following transactions in 2015: AGI (exclusive of capital gains and losses) $240,000 Long-term capital gain …………………… 22,000 Long-term capital loss ………...

Q: Sally has taxable income of $160,000 as of November

Sally has taxable income of $160,000 as of November 30 of this year. She wants to sell a Rodin sculpture that has appreciated $90,000 since she purchased it six years ago, but she does not want to pay...

Q: Platinum, Inc., has determined its taxable income as $215

Platinum, Inc., has determined its taxable income as $215,000 before considering the results of its capital gain or loss transactions. Platinum has a short- term capital loss of $24,000, a long-term c...

Q: The taxpayer is an antiques collector and is going to sell an

The taxpayer is an antiques collector and is going to sell an antique purchased many years ago for a large gain. The facts and circumstances indicate that the taxpayer might be classified as a dealer...

Q: In 2015, Bertha Jarow (head of household with three dependents

In 2015, Bertha Jarow (head of household with three dependents) had a $28,000 loss from the sale of a personal residence. She also purchased from an individual inventor for $7,000 (and resold in two m...

Q: Bridgette is known as the “doll lady.” She started collecting

Bridgette is known as the “doll lady.” She started collecting dolls as a child, always received one or more dolls as gifts on her birthday, never sold any dolls, and eventually owned 600 dolls. She is...

Q: Two years ago, Harriet Company (an unincorporated entity) developed

Two years ago, Harriet Company (an unincorporated entity) developed a process for preserving doughnuts that gives the doughnuts a much longer shelf life. The process is not patented or copyrighted, an...

Q: A sculpture that Tulip & Co. held for investment was destroyed

A sculpture that Tulip & Co. held for investment was destroyed in a flood. The sculpture was insured, and Tulip had a $60,000 gain from this casualty. It also had a $17,000 loss from an uninsured anti...

Q: Harold, a CPA, has a new client who recently moved

Harold, a CPA, has a new client who recently moved to town. Harold prepares the client’s current-year tax return, which shows a net § 1231 gain. Harold calls the client to request copies of the return...

Q: In 2015, Brennen sold a machine used in his business for

In 2015, Brennen sold a machine used in his business for $180,000. The machine was purchased eight years ago for $340,000. Depreciation up to the date of the sale for regular income tax purposes was $...