Questions from Individual Taxation

Q: Anthony, a self-employed plumber, makes a maximum contribution

Anthony, a self-employed plumber, makes a maximum contribution to a SEP for his employee, Debra. Debra’s compensation is $50,000 for the year. How much is he allowed to contribute to the plan for Debr...

Q: During 2019, Jill, age 39, participated in a Section

During 2019, Jill, age 39, participated in a Section 401(k) plan which provides for maximum employee contributions of 12 percent. Jill’s salary was $80,000 for the year. Jill elects to make the maximu...

Q: In 2019, Margaret and John Murphy (both over age 65

In 2019, Margaret and John Murphy (both over age 65) are married taxpayers who file a joint tax return with AGI of $26,100. During the year they incurred the following expenses: In addition, they drov...

Q: Lyndon’s employer withheld $10,100 in state income taxes from

Lyndon’s employer withheld $10,100 in state income taxes from Lyndon’s wages in 2019. Lyndon obtained a refund of $1,700 this year for overpayment of state income taxes for 2018. State income taxes we...

Q: Bea Jones (birthdate March 27, 1984) moved from Texas

Bea Jones (birthdate March 27, 1984) moved from Texas to Florida in December 2018. She lives at 654 Ocean Way, Gulfport, FL 33707. Bea’s Social Security number is 466-78-7359 and she...

Q: Mike sells his home to Jane on April 2, 2019.

Mike sells his home to Jane on April 2, 2019. Jane pays the property taxes covering the full calendar year in October, which amount to $2,500. How much may Mike and Jane each deduct for property taxes...

Q: Laura is a single taxpayer living in New Jersey with adjusted gross

Laura is a single taxpayer living in New Jersey with adjusted gross income for the 2019 tax year of $35,550. Laura’s employer withheld $3,410 in state income tax from her salary. In...

Q: Serena is a 38-year-old single taxpayer. She

Serena is a 38-year-old single taxpayer. She operates a small business on the side as a sole proprietorship. Her 2019 Schedule C reports net profits of $15,624. Her employer does not offer health insu...

Q: Mary paid $2,000 of state income taxes in 2019

Mary paid $2,000 of state income taxes in 2019. She paid $1,500 of state sales tax on the purchase of goods and she also purchased a car in 2019 and paid sales tax of $3,000. How should Mary treat the...

Q: Ken paid the following amounts for interest during 2019: Qualified

Ken paid the following amounts for interest during 2019: Qualified interest on home mortgage = $5,322 Auto loan interest = 850 “Points” on the mortgage for acquisi...