Questions from Individual Taxation


Q: What is a “wash sale”? What is the purpose of

What is a “wash sale”? What is the purpose of the wash sale tax rules?

See Answer

Q: Nick does not use his car for business purposes. If he

Nick does not use his car for business purposes. If he sells his car for less than he paid for it, does he get to deduct the loss for tax purposes? Why or why not?

See Answer

Q: Describe three basic tax planning strategies available to taxpayers investing in capital

Describe three basic tax planning strategies available to taxpayers investing in capital assets.

See Answer

Q: Simon lost $5,000 gambling this year on a trip

Simon lost $5,000 gambling this year on a trip to Las Vegas. In addition, he paid $2,000 to his broker for managing his $200,000 portfolio, and $1,500 to his accountant for preparing his tax return....

See Answer

Q: Clark owns stock in BCS Corporation that he purchased in January of

Clark owns stock in BCS Corporation that he purchased in January of the current year. The stock has appreciated significantly during the year. It is now December of the current year, and Clark is deci...

See Answer

Q: Are dividends and capital gains considered to be investment income for purposes

Are dividends and capital gains considered to be investment income for purposes of determining the amount of a taxpayer’s deductible investment interest expense for the year?

See Answer

Q: How is the amount of net investment income determined for a taxpayer

How is the amount of net investment income determined for a taxpayer with investment expenses and other noninvestment miscellaneous itemized deductions?

See Answer

Q: What limitations are placed on the deductibility of investment interest expense?

What limitations are placed on the deductibility of investment interest expense? What happens to investment interest expense that is not deductible because of the limitations?

See Answer

Q: What types of losses may potentially be characterized as passive losses?

What types of losses may potentially be characterized as passive losses?

See Answer

Q: What tests are applied to determine if losses should be characterized as

What tests are applied to determine if losses should be characterized as passive?

See Answer