Questions from General Taxation

Q: Determine the amount of taxable income that should be reported by a

Determine the amount of taxable income that should be reported by a cash-basis taxpayer in 2019 in each of the following independent cases: a. A taxpayer completes $500 of accounting services in Decem...

Q: Which of the following increases a taxpayer’s at-risk amount?

Which of the following increases a taxpayer’s at-risk amount? a. Cash and the adjusted basis of property contributed to the activity. b. Borrowed amounts used in the activity for which the taxpayer i...

Q: Each of the following taxpayers received a state income tax refund in

Each of the following taxpayers received a state income tax refund in 2019. In all cases, the taxpayer has a filing status of married filing jointly. What amount of the refund is properly included in...

Q: Sean, who is single, received social security benefits of $

Sean, who is single, received social security benefits of $8,000, dividend income of $13,000, and interest income of $2,000. Except as noted, those income items are reasonably consistent from year to...

Q: On July 1, 2019, Rene, a cash-basis

On July 1, 2019, Rene, a cash-basis taxpayer, purchased $500,000 of the newly issued bonds of Acce Corporation for $452,260. The 10-year bonds carry an interest rate of 8% and were sold to yield 9.5%...

Q: In 2019, Joseph and Patricia Jefferson redeemed $8,000

In 2019, Joseph and Patricia Jefferson redeemed $8,000 of Series EE U.S. savings bonds (principal of $5,500 and interest of $2,500), the proceeds from which were used to pay for qualified higher educa...

Q: Zach attended Champion University during 2014–2018. He lived at

Zach attended Champion University during 2014–2018. He lived at home and was claimed by his parents as a dependent during his entire education. He incurred education expenses of $10,000 during college...

Q: Fabian, a single member of the military, was stationed at

Fabian, a single member of the military, was stationed at White Sands, New Mexico. On July 1, 2019, his army company transferred him to Florida as a permanent duty station. Fabian worked full time for...

Q: In May 2019, Regina graduated from the Naval Academy with a

In May 2019, Regina graduated from the Naval Academy with a degree in engineering and was assigned to San Diego as a permanent duty station. In her move to San Diego, Regina incurred the following cos...

Q: Chantel has received a 1099-INT from her financial institution showing

Chantel has received a 1099-INT from her financial institution showing $75 in box 2 of the form. How should she handle this on her 2019 tax return and why?