Question: P Corporation owns 90 percent of the

> Locate Revenue Procedures 2016-11 and 2017-3, identify the topics, and find the dates of these revenue procedures. What arethe3-5mostapplicableCodesectionsforeachone? What IRS tax forms (if any) address the same topics?

> Locate Revenue Rulings 2016-15 and 2017-2, identify the topics, and find the dates of the Revenue Ruling. What are the applicable Code sections for each revenue ruling? Give the proper citations for these revenue rulings in the Internal Revenue Bulletin.

> What tax case by the Supreme Court recognized same-sex marriage?

> Use a tax research database to answer the following questions: a. Paraphrase Code Section 61(a)(4). b. Identify the topic of Code Section 166(d). c. Find the precise authority within the Code section that defines net long-term capital gains. d. Find th

> Find and read a Tax Court regular decision that discusses whether hair transplants are deductible medical expenses. Give the official citation to the case. What did the Tax Court hold? If a case with similar facts were decided today, would the Tax Court

> Which Treasury Regulation provides rules for foreign-owned U.S. corporations and foreign corporations engaged in a trade or business within the United States (reporting corporations)? What IRS form is a reporting corporation required to file that relates

> Assume Sally is a professor who has a PhD in accounting and teaches tax courses. She decides that it would help her teaching to earn a law degree with a heavy emphasis on tax classes. Can she deduct the cost of the tax courses offered as part of her law

> Examine Treas. Reg. §1.183-2. What Code section and language within that Code section does the Treasury Regulation interpret? What does the Treasury Regulation state are the nine relevant factors?

> Find each of the following documents on the web: a. A copy of your state’s individual income tax form, similar to the federal 1040 tax form (if your state is one of the seven not having an income tax, find the form in a neighboring state). b. A copy of

> Determine the number of Treasury Regulations issued for each of the following Code sections. Provide a citation to the last Regulation for sections 101, 183, and 385.

> On January 1, the Hawaii Cancer Institute has received a promise from the Obama Foundation to receive a building that the Foundation recently appraised at $200,000. However, the building cost only $125,000. The Cancer Institute promised to keep the build

> Rosie Corporation has 70% of the outstanding voting stock of Smith Corporation and 10% of the voting stock of Tommy Corporation. Smith also just spent $10,000 to acquire 20% of Tommy’s voting stock. Smith has issued irrevocable letters of credit to guar

> John Forsythe (SSN 555-55-5555) began a custom cabinet manufacturing business, John’s Cabinets (EIN 86-1122334 and Business Code 321000), four years ago as of July 1 of the current tax year. John incorporated the business, and the corporation mad

> The Rite-Way Plumbing Company began business three years ago as of March 1 of the current tax year in Sarasota. Its business address is 124 Division Lane, Sarasota, FL 33645. Its employer identification number is 69-3456789. Its principal business acti

> The operating results for Peep Corporation, an S corporation, for last year were as follows: Revenues Gross sales………………………………$2,000,000 Tax-exempt bond interest&hell

> The Snap-It-Open Corporation incorporated and began operations on January 15 of the current year. Its address is 3701 Commerce Drive, Baltimore, MD 23239. Its employer identification number is 69-7414447. It elects to file its initial tax return as a c

> Go to the IRS Web site (www.irs.gov), print the first page of Form 1120, and enter the following information. Then determine Chelsea Corporation’s tax owed or refund due if it made estimated tax payments of $15,000. Chelsea Corporation (34 Chelse

> Go to the IRS Web site (www.irs.gov) and print Form 4797: Sales of Business Property. Complete Form 4797 for the following sales of machinery on December 20, year 6:  

> Go to the IRS Web site (www.irs.gov) and print Schedule D for Form 1040 and Form 8949. Compute the net effect of the following asset sales on Gineen Tibeau’s taxable income using Form 8949 and Schedule D: a. 100 shares of ABC stock; original cos

> Maria Sanchez, the sole proprietor of a consulting business, has gross receipts of $720,000. Expenses paid by her business are: Advertising……………………………………

> Refer to the information in problems 25 and 35. a. Go to the IRS Web site (www.irs.gov) and print out the first page and Schedule K for Form 1065. Use the information in problem 25 to complete these two forms to the extent possible with the informatio

> Comprehensive Individual Return Problem. Cletus and Josepha Mayor have been married for twelve years and currently live at 2907 Seven Oaks Lane, Columbia, SC 29210. Their Social Security numbers are 223-34-4444 and 322-32-2222, respectively. They have

> Locate and print Form 4684 (Casualties and Thefts). Enter the following information and complete the form to the extent possible: Howser Corporation, a calendar-year corporation, discovered in January that its bookkeeper (who was fired late last year)

> Go to the IRS Web site (www.irs.gov) and print out copies of Schedule C for Form 1040, Schedule SE, Form 4562, Form 4797, and the first page of Form 1040. Using the information in comprehensive problem 53, complete these schedules and forms to the exte

> Go to the IRS Web site at www.irs.gov and print Form 4562. Using the following information, complete this form to the extent possible. Barclays Corporation, a calendar-year taxpayer, had taxable income of $2,000,000 for the year before computing its de

> Corgill Corporation sold land that it used for storing old equipment. Corgill owned the land for seven years and it had a basis of $234,000. Corgill received $50,000 cash and a note for $100,000 and the purchaser assumed Corgill’s $150,000 mortgage on th

> Allan received $5,000 cash and an auto worth $15,000 in exchange for land encumbered by a $13,000 liability that the buyer assumed. a. What is the amount realized on this sale? b. If Allan had a basis of $34,000 in the land, what is his realized gain o

> Charlie sold Whiteacre for $40,000 cash and the buyer assumed Charlie’s $19,000 mortgage on the property. Charlie paid realtor commission of $2,000 on the sale. What is his realized gain or loss if Whiteacre’s adjusted basis is a. $47,000? b. $67,000?

> The Crane Corporation issues $1,500,000 in bonds with a 7.5 percent interest rate. If its marginal tax rate is 35 percent, what is its after-tax cost of the debt?

> Go to the IRS Web site at www.irs.gov and locate Publication 946: How to Depreciate Property. Locate the section on where amortization is reported. On what form is amortization reported? On which part of that form is amortization reported if this is the

> Go to the IRS Web site at www.irs.gov and locate Publication 946: How to Depreciate Property. Locate the depreciation tables at the end of the publication and calculate the first-year depreciation for a $60,000 bus using ADS.

> Go to the IRS Web site at www.irs.gov and locate Publication 946: How to Depreciate Property. Locate the depreciation tables at the end of the publication and calculate the regular first-year depreciation for the following assets, all placed in service i

> A corporation has operating income of $75,000. What is its taxable income if it receives a $20,000 dividend from another corporation in which it has the following ownership: a. 10% b. 65% c. 90%

> Walter Williams, a travel writer, has worked for a well-known publication for a number of years as a private contractor. Last year a friend suggested he become an S corporation, but he failed to make the election. During the current year, the business ha

> Crow Corporation, an S corporation from the date of its incorporation, is in the process of liquidating. During the current year, it reports gross receipts of only $40,000; it has passive investment income of $25,000 from the money it invested after the

> During the current year, Biggie, Inc., a delivery company operating as an S corporation, reported the following results from operations: Revenue………………………………………………$280,000 Salaries…………………………………………………..130,000 Truck expense………………………………………….30,000 Taxes…………

> Capital Partnership makes a proportionate liquidating distribution to one of its partners of $5,000 cash, $6,000 inventory (FMV = $10,000), and land with a $20,000 basis and an $11,000 fair market value. What are the tax consequences to the partner of th

> National Partnership makes a proportionate nonliquidating distribution to one of its partners of two Section 1231 assets. Asset X has a basis of $40,000 and a fair market value of $15,000; Asset B has a basis of $20,000 and a fair market value of $10,000

> The ABC Partnership makes a proportionate nonliquidating distribution to one of its partners of two Section 1231 assets. Asset A has a basis of $40,000 and a fair market value of $15,000; Asset B has a basis of $30,000 and a fair market value of $20,000.

> Jo received one stock right for each share of the 10 shares of stock that she owns in Bill Corporation, which she purchased three years ago for $5 a share. Each stock right allows her to purchase one share of stock for $10. The stock is currently selling

> The Caribe Corporation has $668,000 of taxable income for the current year. In determining this income the accountant listed the following items: $45,000 in dividends from a 30 percent owned corporation $40,000 net operating loss carryover from the pri

> General Corporation has $900,000 of service revenue, a $15,000 capital loss, a $20,000 casualty loss, operating expenses of $685,000, and a charitable contribution of $25,000. a. Determine General’s separate taxable income. b. What items must be determ

> Palmdale Corporation has a regular tax liability of $94,000. It is eligible for a $54,000 general business credit for the current year and has a $30,000 general business credit carryover from the prior year. What is Palmdale’s allowable general business

> David received a gift of stock from Ted this year when it was worth $24,000. Ted purchased the stock for $18,000 five years ago and paid $2,000 of gift taxes on the gift. What is David’s basis for the stock?

> Donut Corporation has $400,000 of taxable income. What is its net tax liability if it has a $120,000 general business credit available?

> What is the tax on WW Corporation’s taxable income of $825,000 if: a. it is a regular corporation? b. it is a personal service corporation?

> What is a corporation’s income tax if its income is: a. $70,000? b. $280,000? c. $900,000? d. $2,250,000? e. $14,000,000?

> The Jingle Corporation has income from operations of $459,000. It has dividend income of $68,000 from a corporation in which it owns 5 percent. a. What is the corporation’s taxable income? b. How would your answer change if Jingle owns 35 percent of th

> A corporation has gross sales revenue of $289,000, cost of sales of $98,000, a Section 179 deduction of $20,000 (financial depreciation = $5,000), operating expenses of $122,000, and a Section 1231 gain of $21,000 on the sale of some machinery (the gain

> The Prosperity Corporation has accumulated $200,000 of earnings beyond the reasonable needs of the business. The corporation’s regular taxable income is $165,000. Its adjusted taxable income for determining the accumulated earnings tax is $178,000. What

> Zenon Corporation (a calendar-year corporation) began work on a new experimental project in year 1. It incurred $8,000 in qualifying research expenses in year 1 and $11,000 in year 2. The benefits from the project will be realized beginning in February y

> Orange Corporation acquired all of the assets of Lemon Company for $10,000,000. The fair market value of the tangible assets totaled $8,000,000. The $2,000,000 difference is considered goodwill. Orange Corporation expects to continue its business operati

> Paul purchased a royalty interest in an oil well for $125,000. Paul’s share of gross income from oil sales for the year is $40,000 and his share of expenses for the oil production is $13,000. What is Paul’s percentage depletion deduction for the year? Wh

> Six years ago, Sharon purchased her principal residence for $500,000. In the current year, she converts the property to rental use because she has been unable to sell it due to the depressed real estate market. The property’s current fair market value is

> A corporation has taxable income is $1,500,000. If it distributes its after-tax income to its shareholders whose dividend tax rate is 15 percent, what are the total tax and the combined effective tax rate on corporate income?

> Tina and Tony, a married couple, have owned and lived in their house for 20 years. They want to sell it now and move to a smaller place. They purchased the home for $56,000 and put $30,000 of improvements into the home over the years. If they sell the ho

> Byron entered into a 36-month lease of an automobile on March 1, year 1. He used it 80 percent for business and 20 percent for personal use. In year 2 he used it 90 percent for business and 10 percent for personal use. The fair market value of the automo

> Trish entered into a 36-month lease of an automobile on January 1. She uses it 90 percent for business and 10 percent for personal use. The fair market value of the automobile at the inception of the lease is $50,000. She made 12 monthly lease payments o

> Jillian is an employee of Monrow Corporation (a calendar-year corporation). In February 2017, Monrow purchased a new $37,000 car for Jillian’s use. During 2017 and 2018, 60 percent of Jillian’s mileage on the car was business related and 40 percent was f

> Carrie received 10 shares of Collie common stock as a 10 percent dividend on the 100 common shares she currently owns. She paid $4,400 for the original shares. If she sells the 10 shares that she just received for $800, what is her gain or loss on the sa

> Vanguard Corporation has excess land that it distributes to its shareholders as a dividend. Each of the four shareholders gets a portion of the land valued at $23,000 ($92,000 total value). The corporation’s basis for the land is $68,000. What are the co

> The Amble Corporation has $4,000 in current earnings and profits and $23,000 in accumulated earnings and profits. It makes a $6,000 dividend distribution at the end of the year to its shareholders. How is this distribution taxed, and what is the corporat

> Nicko Corporation (a calendar-year corporation) purchased a new machine (7-year property) in July 2014 for $20,000. Nicko did not elect Section 179 for this asset but did claim 50 percent bonus depreciation. In November 2017, Nicko sells the machine. Wha

> Gordon Corporation had $102,000 of retained earnings at the beginning of the year. It had $87,000 of financial accounting income and paid $45,000 in dividends. What is the corporation’s ending retained earnings balance?

> Last year, Anne purchased a condo unit for $125,000 as her personal residence. In the current year, the condo unit appraises at $132,000, and Anne moves out and converts the condo to rental property. What basis can Anne use when computing her depreciatio

> David operates his business as a sole proprietorship. In the current year, he spends $20,000 for a used machine (7-year property). His business income, before consideration of any Section 179 deduction, is $17,000. David elects to expense $20,000 under S

> On March 1, 2017 Harry Corporation (a calendar-year taxpayer) purchased and placed in service office furniture costing $550,000. Compute the maximum amount Harry Corporation can elect to expense under Section 179 for this furniture if a. this is the onl

> Corando Corporation (a calendar-year taxpayer) purchased $850,000 of used factory equipment in April 2017. Determine the maximum depreciation deduction for the equipment for 2017 and 2018.

> Kondar Corporation (a calendar-year taxpayer) spent $2,090,000 to purchase used machinery in February 2017. a. What is the maximum that Kondar can elect to expense under Section 179? b. What is the basis for calculating regular MACRS depreciation on th

> Calahan Corporation regularly factors its receivables when they are short of cash. This spring they not only factored $325,000 of receivables at 80 percent of their value but sold two company automobiles that they had purchased five months earlier for $4

> Willis Corporation (a calendar-year corporation) purchased $550,000 of used machinery (7-year property) on August 1. No other property was acquired in 2017. a. What is Willis Corporation’s depreciation expense for 2017 and 2018 if Section 179 is not ele

> Barry Corporation sold a machine used in its business for two years for $27,000. The machine originally cost $24,000 and it had an adjusted basis at the time of the sale of $17,000. Determine the amount and type of gain recognized on the sale.

> At the beginning of 2017, AB Corporation (a calendar-year corporation) owned the following assets: On February 1, 2017, AB sold its office furniture. On March 15, 2017, AB sold its computer equipment. Compute AB Corporation’s 2017 depr

> Tatum Corporation (a calendar-year corporation) purchased a building on June 6 of the current year for $300,000, of which $60,000 is for the land. What is the depreciation for the first year if the building is a. a warehouse? b. a rental apartment buil

> What is the effect on total taxes if a corporation with $200,000 of taxable income pays a bonus of $50,000 to its single shareholder-owner who has $100,000 of other taxable income and is taxed at the 28 percent tax rate? What is the total effective tax r

> Two years ago, Warren purchased a computer for $4,000 that was used exclusively for personal purposes until this year. At the beginning of the current year, Warren opened a consulting business as a sole proprietorship and began using the computer solel

> Loser Corporation decides to liquidate and files a plan of liquidation with the IRS. It is unable to sell its assets, so it distributes them to its sole shareholder, Bummer. There are only three assets: inventory (fair market value = $4,000; basis = $3,5

> Beacon Corporation had operated a chain of restaurants for 15 years and owned a small trucking company for 10 years. It decided to sell all the assets of the trucking company (Section 1231 assets) for $1,500,000. The assets had a basis of $900,000 and th

> Sheri owns 800 of the 1,500 outstanding shares of Carney Corporation, which she bought a number of years ago for $20 each. She needs money for her daughter’s tuition but does not want to sell all of her shares in the corporation. Carney has $200,000 in e

> Clarington Corporation, a calendar year taxpayer, had two shareholders, Adam and Eve. Adam owns 40 percent and Eve 60 percent of the corporation’s stock. In each of the following situations, determine how the dividends will be taxed to Adam and Eve and i

> Jenkins Corporation had $675,000 of taxable income last year and $575,000 this year. What is the minimum amount that it must submit for each estimated quarterly tax payment to avoid any penalty for underpayment?

> The Falcon Corporation has $68,000 in taxable income. Its accountant uncovered $87,000 in net positive adjustments and $2,000 of preference items for its alternative minimum taxable income. What are the corporation’s AMTI and AMT?

> Mondial Corporation’s financial accounting records show it had gross revenue of $980,000, cost of goods sold of $420,000, operating expenses of $380,000, and $4,000 of dividends received from a 40-percent-owned owned corporation. Its operating expenses i

> Whitlaw Corporation has $150,000 of gross profit on sales, operating expenses of $60,000 (excluding cost recovery), $4,000 dividend income from a one-percent-owned corporation, a $10,000 capital gain and $15,000 capital loss, a $15,000 Section 179 deduct

> Velvet Corporation has revenues of $340,000 and deductible expenses of $350,000. It also received a $40,000 dividend from a corporation in which it owns 10 percent. What is the corporation’s taxable income?

> Columbo Corporation, a calendar-year corporation, began business in 2014. With the initial capital contributions from its sole shareholder, it purchased a building on March 12 for $250,000. It also purchased the following items, all used, for use in the

> Explain the difference between a realized gain and a recognized gain.

> X, Y, and Z form XYZ Partnership by contributing cash and property as follows: X contributes $40,000 cash for a 20 percent interest. Y contributes property valued at $80,000 for a 40 percent interest. This property has a basis in Y’s hands of $50,000. Fo

> Jim and Angie form the JAZ Partnership with Zoe by contributing $75,000 each to partnership equity. Zoe, the third partner, contributes property with a basis of $50,000 and fair market value of $75,000. The three are equal partners in the partnership. De

> Tinker incorporates his sole proprietorship by transferring a building, equipment, and inventory to the Tinker Corporation in exchange for all its stock. The building has a value of $750,000 and a basis of $800,000, the equipment has a value of $400,000

> Explain the basic provisions of the Coverdell Education Saving plan.

> Explain why Congress added the kiddie tax provisions and which taxpayers are affected by it.

> Under what circumstances will a gift made in trust for a minor child qualify for the annual exclusion?

> What is a present interest and how is it distinguished from a future interest?

> How is the net investment income surtax calculated for a trust? Explain how a trust can avoid this tax.

> What purpose is served by the distributable net income of a trust or estate?

> What are adjusted taxable gifts, and how do they affect the calculation of a decedent’s estate tax?

> Why is the Section 179 expensing election more valuable to a small business than to a large business?

> How do the estate income tax rules encourage a quick distribution of estate assets?

> Sidney is a psychiatrist. Four years ago, he purchased the building in which his office is located for $375,000. Sidney transfers ownership of the building to his daughter, Nora, and signs a leaseback agreement stipulating that he pay annual rent of $35,