STUFF TO REMEMBER AND STUDY FOR CH 4-8

Harriet and Harry Combs (both 37 years old) are married and both want to contribute to a Roth IRA. In 2019, their AGI is $50,000. Harriet earned $46,000 and Harry earned $4,000. (Leave no answer blank. Enter zero if applicable.) b. How much can Harriet contribute if she files a separate return?

$0

Rubio recently invested $20,000 (tax basis) in purchasing a limited partnership interest in which he will have no management rights in the company. His at-risk amount is $15,000. In addition, Rubio's share of the limited partnership loss for the year is $22,000, his share of income from a different limited partnership is $5,000, and he has $40,000 in wage income and $10,000 in long-term capital gains. (Input the amount as positive value.) b. How much of the loss from part (a) is allowed under the at-risk amount limitations?

$15,000

Rubio recently invested $20,000 (tax basis) in purchasing a limited partnership interest in which he will have no management rights in the company. His at-risk amount is $15,000. In addition, Rubio's share of the limited partnership loss for the year is $22,000, his share of income from a different limited partnership is $5,000, and he has $40,000 in wage income and $10,000 in long-term capital gains. (Input the amount as positive value.) a. How much of Rubio's $22,000 loss is allowed considering only the tax-basis loss limitations?

$20,000

Jackson is 18 years old and has a dog-sitting business. Calculate the 2019 standard deduction Jackson will claim under the following independent circumstances. a. Jackson reported $2,000 of earnings from his dog sitting, $300 in interest income from his savings account, and Jackson's parents claim him as a dependent.

$2350

Rubio recently invested $20,000 (tax basis) in purchasing a limited partnership interest in which he will have no management rights in the company. His at-risk amount is $15,000. In addition, Rubio's share of the limited partnership loss for the year is $22,000, his share of income from a different limited partnership is $5,000, and he has $40,000 in wage income and $10,000 in long-term capital gains. (Input the amount as positive value.) c. How much of Rubio's $22,000 loss from the limited partnership can he deduct in the current year considering all limitations?

$5,000

This year, Major Healy paid $40,000 of interest on a mortgage on his home (he borrowed $800,000 to buy the residence in 2015; $900,000 original purchase price and value at purchase), $6,000 of interest on a $120,000 home-equity loan on his home (loan proceeds were used to buy antique cars), and $10,000 of interest on a mortgage on his vacation home (borrowed $200,000 to purchase the home in 2010). Major Healy's AGI is $220,000. How much interest expense can Major Healy deduct as an itemized deduction?

$50,000

Harriet and Harry Combs (both 37 years old) are married and both want to contribute to a Roth IRA. In 2019, their AGI is $50,000. Harriet earned $46,000 and Harry earned $4,000. (Leave no answer blank. Enter zero if applicable.) a. How much can Harriet contribute to her Roth IRA if they file a joint return?

$6000

ylvester files as a single taxpayer during 2019. He itemizes deductions for regular tax purposes. He paid charitable contributions of $7,000, real estate taxes of $1,000, state income taxes of $4,000, and mortgage interest of $2,000 on $30,000 of acquisition indebtedness on his home. Sylvester's regular taxable income is $100,000. What is Sylvester's AMTI?

105000

the following independent circumstances. b. Jackson reported $500 of earnings from his dog sitting and $2,000 in interest income from his savings account, and Jackson's parents claim him as a dependent.

1100

n each of the following independent cases, indicate the amount (1) deductible for AGI, (2) deductible from AGI, and (3) neither deductible for nor from AGI before considering income limitations or the standard deduction. (Leave no answers blank. Enter zero if applicable.) d. Tess paid $1,150 of state income taxes on her consulting income.

1150 state income tax is an itemized deduction

Kyle, a single taxpayer, worked as a free-lance software engineer for the first three months of 2019. During that time, he earned $44,000 of self-employment income. On April 1, 2019, Kyle took a job as a full-time software engineer with one of his former clients, Hoogle Inc. From April through the end of the year, Kyle earned $178,000 in salary.What amount of FICA taxes (self-employment and employment related) does Kyle owe for the year?

12167

Jackson is 18 years old and has a dog-sitting business. Calculate the 2019 standard deduction Jackson will claim under the following independent circumstances. c. Jackson reported $8,000 of earnings from his dog sitting, $3,000 in interest income, and Jackson's parents do not claim him as a dependent.

12200

Henrich is a single taxpayer. In 2019, his taxable income is $450,000. What is his income tax and net investment income tax liability in each of the following alternative scenarios? Use Tax Rate Schedule, Dividends and Capital Gains Tax Rates for reference. (Round your answers to 2 decimal places. Leave no answer blank. Enter zero if applicable.) c. His $450,000 of taxable income includes $55,000 of long-term capital gain that is taxed at preferential rates.

122466 net investment:2090

Henrich is a single taxpayer. In 2019, his taxable income is $450,000. What is his income tax and net investment income tax liability in each of the following alternative scenarios? Use Tax Rate Schedule, Dividends and Capital Gains Tax Rates for reference. (Round your answers to 2 decimal places. Leave no answer blank. Enter zero if applicable.) b. His $450,000 of taxable income includes $2,000 of long-term capital gain that is taxed at preferential rates.

132393.5 net investment tax: 76

Henrich is a single taxpayer. In 2019, his taxable income is $450,000. What is his income tax and net investment income tax liability in each of the following alternative scenarios? Use Tax Rate Schedule, Dividends and Capital Gains Tax Rates for reference. (Round your answers to 2 decimal places. Leave no answer blank. Enter zero if applicable.) a. All of his income is salary from his employer.

132693.5

Charlie's regular tax liability is $43,695. His tentative minimum tax is $58,304. He doesn't have any tax credits. What is the amount of Charlie's alternative minimum tax (AMT) and how much will he actually pay in tax for the current year? Multiple choice question.

14609

rey has two dependents, his daughters, ages 14 and 17, at year-end. Trey files a joint return with his wife.What amount of child credit will Trey be able to claim for his daughters under each of the following alternative situations? Use Exhibit 8-8. b. His AGI is $420,000.

1500

Steve's tentative minimum tax (TMT) for 2019 is $245,000. (Leave no answer blank. Enter zero if applicable.) a. What is his AMT if his regular tax is $230,000?

15000

Simpson, age 45, is a single individual who is employed full time by Duff Corporation. This year Simpson reports AGI of $50,000 and has incurred the following medical expenses: Dentist charges$900 Physician's charges 1,800 Optical charges 500 Cost of eyeglasses 300 Hospital charges 2,100 Prescription drugs 250 Over-the-counter drugs 450 Medical insurance premiums (not through an exchange) 775 a. Calculate the amount of medical expenses that will be included with Simpson's itemized deductions after any applicable limitations.

1625

In 2019, Carson is claimed as a dependent on his parents' tax return. Carson's parents provided most of his support.What is Carson's tax liability for the year in each of the following alternative circumstances? Use Tax Rate Schedule, Dividends and Capital Gains Tax Rates, Estates and Trusts for reference. Carson is 17 years old at year-end and earned $14,000 from his summer job and part-time job after school. This was his only source of income.

180

while donations of certain capital gain property to private nonoperating foundations are limited to_______%

20%

In 2019, Carson is claimed as a dependent on his parents' tax return. Carson's parents provided most of his support.What is Carson's tax liability for the year in each of the following alternative circumstances? Use Tax Rate Schedule, Dividends and Capital Gains Tax Rates, Estates and Trusts for reference. b. Carson is 23 years old at year-end. He is a full-time student and earned $14,000 from his summer internship and part-time job. He also received $5,000 of qualified dividend income.

202.5

Trey has two dependents, his daughters, ages 14 and 17, at year-end. Trey files a joint return with his wife.What amount of child credit will Trey be able to claim for his daughters under each of the following alternative situations? Use Exhibit 8-8. a. His AGI is $100,000.

2500

Sheri's only source of income for the year is a salary of $40,000. She is not married and has three dependent children who are not eligible for the child tax credit. Sheri's tax liability is $1,795 before any credits or prepayments are applied. She had $2,000 withheld from her salary. After applying the earned income credit, what is the amount of Sheri's refund?

2515

Assuming the loss is deductible under the basis, at-risk amounts, and passive loss rules, what is the maximum amount that Jay can deduct in 2020?

259,000

Jim received $275 of car repair services from another member of the club. what amount is included in gross income

275

Taxpayers can completely offset capital gains with???? If an excess capital loss remains, married filing jointly taxpayers can deduct up to....

capital loss, up to 3000

The penalty for ______ is deductible for AGI. underpayment of income tax early distribution of retirement account early withdraw of a timed saving account

early withdraw of a timed saving account

Bessie is a partner in SULU Enterprises LLC. This year SULU reported that Bessie's share of rental income was $2,700 and her share of municipal interest was $750.

economic income:3450 amount included in gross income:2700

Which types of expenditures can they make from funds in their IRAs without incurring a 10% penalty for early withdrawal?

educational and medical purposes

The passive activity loss rules are applied prior to the consideration of tax-basis and at-risk amount loss limits. True false question.

false. it comes after the at-risk and tax basis

qualified educational loan interest can be fully deductible

false. there is a limit of 2500

In each of the following independent cases, indicate the amount (1) deductible for AGI, (2) deductible from AGI, and (3) neither deductible for nor from AGI before considering income limitations or the standard deduction. (Leave no answers blank. Enter zero if applicable.) b. Tyler paid $85 for minor repairs to the fence at a rental house he owned.

for agi $85 Rental and royalty expense

Cyndi has a second home in Mississippi. She rented the home to non-family members for 20 days last year. What is the minimum number of days that she must have used the home for personal purposes in order for it to be considered a residence?

greater of 14 days or 10% of days rented

Rhonda is currently in the 12 percent tax bracket. She reports a $400 tax deduction. How will this deduction affect her tax liability?

her tax liability will decrease by $48

e. Edith and her spouse support their 35-year-old son, Slim. Slim is a full-time college student who earned $5,500 over the summer in part-time work.

married filing jointly with no dependents

Deshi cannot convince his spouse to consent to signing a joint return. The couple has not separated.

married filing separately with no dependent

In each of the following independent cases, determine the taxpayer's filing status and the number of dependents the taxpayer is allowed to claim. c. Charlie intended to file a joint return with his spouse, Sally. However, Sally died in December. Charlie has not remarried.

married filling jointly with no dependents

If employees receive reimbursement for legitimate business expenses but are not required to provide documentation to the employer for those expenses, the employees ______. (Check all that apply.)

must treat the reimbursements as taxable compensation and may not deduct the expenses

Aishwarya's husband passed away in 2018. She needs to determine whether Jasmine, her 17-year-old stepdaughter, who is single, qualifies as her dependent in 2019. Jasmine is a resident but not a citizen of the United States. She lived in Aishwarya's home from June 15 through December 31, 2019. Aishwarya provided more than half of Jasmine's support for 2019. b. Would Aishwarya be allowed to claim Jasmine as a dependent for 2019 if Aishwarya provided more than half of Jasmine's support in 2019, Jasmine lived in Aishwarya's home from July 15 through December 31 of 2019, and Jasmine reported gross income of $5,000 for the year?

no, because her gross income is 5000

In each of the following independent cases, indicate the amount (1) deductible for AGI, (2) deductible from AGI, and (3) neither deductible for nor from AGI before considering income limitations or the standard deduction. (Leave no answers blank. Enter zero if applicable.) a. Ted paid $8 rent on a safety deposit box at the bank. In this box he kept the few shares of stock that he owned.

nondeductible $8 investment expense

Business tax credits are _______ credits, but may be carried back one year or forward for ______ years.

nonrefundable 20

Markita donated stock that she has held for less than a year to a qualified charitable organization. Her basis in the stock is $1,000 and the fair market value of the stock is $1,200. In regards to the donation, the stock is

ordinary income property and $1000

Horatio and Kelly were divorced at the end of last year. Neither Horatio nor Kelly remarried during the current year and Horatio moved out of state. Determine the filing status of Horatio and Kelly for the current year in the following independent situations: c. Assume the same facts as in part (b) but Kelly allowed Horatio to claim Amy as a dependent under the divorce decree even though Amy did not reside with Horatio at all during the current year.

single head of household

Horatio and Kelly were divorced at the end of last year. Neither Horatio nor Kelly remarried during the current year and Horatio moved out of state. Determine the filing status of Horatio and Kelly for the current year in the following independent situations: b. Horatio and Kelly had one child, Amy, who turned 10 years of age in the current year. Amy lived with Kelly for all of the current year and Kelly provided all of her support.

single head of household

Horatio and Kelly were divorced at the end of last year. Neither Horatio nor Kelly remarried during the current year and Horatio moved out of state. Determine the filing status of Horatio and Kelly for the current year in the following independent situations: e. Assume the original facts except that during the current year Kelly's mother, Janet, lived with Kelly. For the current year, Kelly was able to claim Janet as a dependent under a multiple support agreement.

single single

Horatio and Kelly were divorced at the end of last year. Neither Horatio nor Kelly remarried during the current year and Horatio moved out of state. Determine the filing status of Horatio and Kelly for the current year in the following independent situations: a. Horatio and Kelly did not have any children and neither reported any dependents in the current year.

single single

Horatio and Kelly were divorced at the end of last year. Neither Horatio nor Kelly remarried during the current year and Horatio moved out of state. Determine the filing status of Horatio and Kelly for the current year in the following independent situations: d. Assume the original facts except that during the current year Madison, a 17-year-old friend of the family, lived with Kelly (for the entire year) and was fully supported by Kelly.

single single

In each of the following independent cases, determine the taxpayer's filing status and the number of dependents the taxpayer is allowed to claim. a. Alexandra is a blind widow (her spouse died five years ago) who provides a home for her 18-year-old nephew, Newt. Newt's parents are dead and so Newt supports himself. Newt's gross income is $5,000.

single with no dependants

In each of the following independent cases, determine the taxpayer's filing status and the number of dependents the taxpayer is allowed to claim. b. Bharati supports and maintains a home for her daughter, Daru, and son-in-law, Sam. Sam earned $15,000 and filed a joint return with Daru, who had no income.

single with no dependents

what qualifify as a widower

unmarried must have dependents can use for up to 2 years after death of spouse

Ben sold stock for $10,000 and paid a sales commission of $250. Ben purchased the stock several years ago for $4,000.

whats his economic income & amount included in gross income 5750

The income tax is paid on a pay-as-you-go basis through_____ or_______ tax payments.

withholding estimated

Aishwarya's husband passed away in 2018. She needs to determine whether Jasmine, her 17-year-old stepdaughter, who is single, qualifies as her dependent in 2019. Jasmine is a resident but not a citizen of the United States. She lived in Aishwarya's home from June 15 through December 31, 2019. Aishwarya provided more than half of Jasmine's support for 2019. a. Is Aishwarya allowed to claim Jasmine as a dependent for 2019?

yes

Aishwarya's husband passed away in 2018. She needs to determine whether Jasmine, her 17-year-old stepdaughter, who is single, qualifies as her dependent in 2019. Jasmine is a resident but not a citizen of the United States. She lived in Aishwarya's home from June 15 through December 31, 2019. Aishwarya provided more than half of Jasmine's support for 2019. c. Would Aishwarya be allowed to claim Jasmine as a dependent for 2019 if Aishwarya provided more than half of Jasmine's support in 2019, Jasmine lived in Aishwarya's home from July 15 through December 31 of 2019, and Jasmine reported gross income of $2,500 for the year?

yes gross income is less than 4300

This year, Paula and Simon (married filing jointly) estimate that their tax liability will be $200,000. Last year, their total tax liability was $170,000. They estimate that their tax withholding from their employers will be $175,000. a. Are Paula and Simon required to increase their withholdings or make estimated tax payments this year to avoid the underpayment penalty? multiple choiceYesNo b.By how much, if any, must Paula and Simon increase their withholding and/or estimated tax payments for the year to avoid underpayment penalties?

yes, 5000

Jim received a $450 credit that can only be applied for goods or services from club members next year. amount included in gross income

0

Steve's tentative minimum tax (TMT) for 2019 is $245,000. (Leave no answer blank. Enter zero if applicable.) b. What is his AMT if his regular tax is $250,000?

0

erry was ill for three months and missed work during this period. During his illness, Terry received $4,500 in sick pay from a disability insurance policy.Determine what amounts will be included in Terry's gross income under the following independent circumstances: (Leave no answer blank. Enter zero if applicable. Do not round intermediate calculations. Round your final answer to the nearest whole dollar amount.) b. Terry paid the $2,800 in premiums for his disability insurance this year.

0

Terry was ill for three months and missed work during this period. During his illness, Terry received $4,500 in sick pay from a disability insurance policy.Determine what amounts will be included in Terry's gross income under the following independent circumstances: (Leave no answer blank. Enter zero if applicable. Do not round intermediate calculations. Round your final answer to the nearest whole dollar amount.) d. Terry and his employer share the cost of his disability insurance. Terry's employer paid $1,800 in disability premiums for Terry this year as a nontaxable fringe benefit, and Terry paid the remaining $1,000 of premiums from his after-tax salary.

2893

Trey has two dependents, his daughters, ages 14 and 17, at year-end. Trey files a joint return with his wife.What amount of child credit will Trey be able to claim for his daughters under each of the following alternative situations? Use Exhibit 8-8. c. His AGI is $420,100, and his daughters are ages 10 and 12.

2950

Donations of capital gain property to public charities are generally limited to______%

30%

Harriet and Harry Combs (both 37 years old) are married and both want to contribute to a Roth IRA. In 2019, their AGI is $50,000. Harriet earned $46,000 and Harry earned $4,000. (Leave no answer blank. Enter zero if applicable.) c. How much can Harry contribute to his Roth IRA if they file separately?

3600

Henrich is a single taxpayer. In 2019, his taxable income is $450,000. What is his income tax and net investment income tax liability in each of the following alternative scenarios? Use Tax Rate Schedule, Dividends and Capital Gains Tax Rates for reference. (Round your answers to 2 decimal places. Leave no answer blank. Enter zero if applicable.) d. Henrich has $195,000 of taxable income, which includes $50,000 of long-term capital gain that is taxed at preferential rates. Assume his modified AGI is $210,000.

36474.5 net investment 380.00

Terry was ill for three months and missed work during this period. During his illness, Terry received $4,500 in sick pay from a disability insurance policy.Determine what amounts will be included in Terry's gross income under the following independent circumstances: (Leave no answer blank. Enter zero if applicable. Do not round intermediate calculations. Round your final answer to the nearest whole dollar amount.) a. Terry has disability insurance provided by his employer as a nontaxable fringe benefit. Terry's employer paid $2,800 in disability premiums for Terry this year.

4500

Jim received a $550 credit that gave him the option of receiving a season pass at a local ski resort from another member of the club. However, he forgot to request the pass by the end of the ski season and his credit expired. amount included in gross income

550

cash donations to public charity ___% deductible from a persons agi

60%

Tim is a single, cash-method taxpayer and has AGI of $50,000. In April of this year, Tim paid $1,020 with his state income tax return for the previous year. During the year, Tim had $5,400 of state income tax and $18,250 of federal income tax withheld from his salary. In addition, Tim made estimated payments of $1,360 and $1,900 of state and federal income taxes, respectively. Finally, Tim expects to receive a refund of $500 for state income taxes when he files his state tax return for this year in April next year. What is the amount of taxes that Tim can deduct as an itemized deduction?

7780

In 2019, Susan (44 years old) is a highly successful architect and is covered by an employee-sponsored plan. Her husband, Dan (47 years old), however, is a PhD student and is unemployed. Compute the maximum deductible IRA contribution for each spouse in the following alternative situations. (Leave no answer blank. Enter zero if applicable.) a. Susan's salary and the couple's AGI is $205,000. The couple files a joint tax return.

SUSAN deductible $0 Dan deductible $0

In 2019, Susan (44 years old) is a highly successful architect and is covered by an employee-sponsored plan. Her husband, Dan (47 years old), however, is a PhD student and is unemployed. Compute the maximum deductible IRA contribution for each spouse in the following alternative situations. (Leave no answer blank. Enter zero if applicable.) d. Susan's salary and her AGI is $80,000. Dan reports $5,000 of AGI (earned income). The couple files separate tax returns.

Susan Deductible $0 Dan Deductible $3000

In 2019, Susan (44 years old) is a highly successful architect and is covered by an employee-sponsored plan. Her husband, Dan (47 years old), however, is a PhD student and is unemployed. Compute the maximum deductible IRA contribution for each spouse in the following alternative situations. (Leave no answer blank. Enter zero if applicable.) c. Susan's salary and the couple's AGI is $80,000. The couple files a joint tax return.

Susan Deductible $6000 Dan Deductible $6000

In 2019, Susan (44 years old) is a highly successful architect and is covered by an employee-sponsored plan. Her husband, Dan (47 years old), however, is a PhD student and is unemployed. Compute the maximum deductible IRA contribution for each spouse in the following alternative situations. (Leave no answer blank. Enter zero if applicable.) b. Susan's salary and the couple's AGI is $124,000. The couple files a joint tax return.

Susan deductible $0 Dan Deductible 6000

Chasity is 20, has a full-time job, and supports herself. Her brother, William, age 22, has decided to go back to college. He moved in with Chasity and is attending college full-time. Which of the following statements is accurate regarding the age test for a qualifying child and how it applies to William?

William does NOT meet the age test because he is older than Chasity.