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- For each of the following situations, indicate whether the taxpayer(s) is (are) required to file a tax return for 2021. Explain your answer. Yes? No? and Why Monica is a maid in a San Francisco Hotel. Monica received $500 in unreported tips during 2021 and owes Social Security taxes on these tips. Her total income for the year, including tips, is $4,500. Is Monica required to file an income tax return for 2021?The executor of an estate is filing an income tax return for the current period. Revenues of $25,000 have been earned. Which of the following is not a deduction allowed in computing taxable income? Choose the correct.a. Income distributed to a beneficiary.b. Funeral expenses.c. A personal exemption.d. Charitable donations.Geraldine is an accrual basis taxpayer who has the following transactions during the current calendar tax year: Accrued business income (except rent) $414,800 Accrued business expenses (except rent) 311,100 Rental income on a building leased for the next 6 months, received on December 1 41,480 Prepaid rent expense for 6 months, paid on December 1 20,740 Calculate Geraldine's net income from her business for the current year. If required, your answers to the nearest dollar. Income: Other than rental $ Rental Expenses: Other than rental Rental Net income
- Suppose that Ana is preparing to file her taxes. She is single and currently lives in Denver. Ana earned $110,000 in taxable income in 2022. She reviews the following table, which shows the IRS tax rates for a single taxpayer in 2022. On Annual Taxable Income... Up to $10,275 From $10,275 to $41,775 From $41,775 to $89,075 From $89,075 to $170,050 From $170,050 to $215,950 From $215,950 to $539,900 Over $539,900 The Tax Rate Is... (Percent) 10.0 12.0 Ana calculates that she owes 22.0 24.0 32.0 35.0 37.0 Based on the IRS table, Ana calculates that her marginal tax rate is in income taxes for 2022. when her annual taxable income is $110,000. Ana then calculates that her average tax rate is, based on the annual income level and the amount of taxes she owes for 2022. After figuring out what she owes in taxes in 2022, Ana decides to ask an accountant for tax advice. The accountant claims that he has found a legal way to shelter $2,000 of taxable income from the federal government. The…Shafron, Inc. is a calendar year-end, cash method taxpayer. It provides consulting services for various clients in the local community. Shafron, Inc. had the following transactions in 2020. Determine the tax treatment for each transaction. For credit, you must round your answer to the NEAREST DOLLAR. Do NOT enter the dollar sign in your answer - only enter the numbers (e.g., X,XXX). For example, one thousand dollars should be entered as 1,000. Enter zero (i.e., “0”) where necessary. (a) On March 15, 2020, Shafron, Inc. received $30,000 from JBD, Inc. for business consulting services. Shafron, Inc. estimated the project will take 6 months and began working on the project on April 1, 2020. How much (if any) of the payment is included in Shafron, Inc.’s gross income? $ (b) Shafron, Inc. purchases an 18-month liability insurance policy. Per the contract with the insurance company, Shafron, Inc. paid the entire cost of the insurance coverage ($36,000) on November 1, 2020. The coverage…Determine the amount of taxable income that should be reported by a cash-basis taxpayer in 2022 in each of the following independent cases: Required: A taxpayer completes $300 of accounting services in December 2022 for a client who pays for the accounting work in January 2023. A taxpayer is in the business of renting computers on a short-term basis. On December 1, 2022, she rents a computer for a $100 rental fee and receives a $250 deposit. The customer returns the computer and is refunded the deposit on December 20, 2022. Same facts as (b) except that the computer is returned on January 5, 2023. On December 18, 2022, a landlord rents an apartment for $385 per month and collects the first and last months' rent up front. It is customary that tenants apply the security deposit to their last month's rent upon moving out. An accountant agrees to perform $315 of tax services for an auto mechanic who has agreed to perform repairs on the car of the accountant’s wife. The mechanic repairs…
- Determine the amount of taxable income that should be reported by a cash-basis taxpayer in 2022 in each of the following independent cases: Required: a. A taxpayer completes $700 of accounting services in December 2022 for a client who pays for the accounting work in January 2023. b. A taxpayer is in the business of renting computers on a short-term basis. On December 1, 2022, she rents a computer for a $260 rental fee and receives a $650 deposit. The customer returns the computer and is refunded the deposit on December 20, 2022. c. Same facts as (b) except that the computer is returned on January 5, 2023. d. On December 18, 2022, a landlord rents an apartment for $625 per month and collects the first and last months' rent up front. It is customary that tenants apply the security deposit to their last month's rent upon moving out. e. An accountant agrees to perform $395 of tax services for an auto mechanic who has agreed to perform repairs on the car of the accountant's wife. The…Determine the amount of taxable income that should be reported by a cash-basis taxpayer in 2022 in each of the following independent cases: Required: a. A taxpayer completes $700 of accounting services in December 2022 for a client who pays for the accounting work in January 2023. b. A taxpayer is in the business of renting computers on a short-term basis. On December 1, 2022, she rents a computer for a $260 rental fee and receives a $650 deposit. The customer returns the computer and is refunded the deposit on December 20, 2022. c. Same facts as (b) except that the computer is returned on January 5, 2023. d. On December 18, 2022, a landlord rents an apartment for $625 per month and collects the first and last months' rent up front. It is customary that tenants apply the security deposit to their last month's rent upon moving out. e. An accountant agrees to perform $395 of tax services for an auto mechanic who has agreed to perform repairs on the car of the accountant's wife. The…Gomez maintains a law firm and registered as non-VAT taxpayer. For a particular client, the amount of professional fee imposed by Gomez is P300,000. Compute the business tax on this particular transaction. The taxable year is 2021. A. P3,000 percentage tax B. P9,000 percentage tax C. P36,000 percentage tax D. Zero
- For the following taxpayers, indicate whether the taxpayer should file a tax return and why. a. Robert earned $50,000 this year as a staff accountant. His estimated tax liability is $4,500, and he expects to receive a $500 tax refund. b. Amy earned $4,000 this year working part-time. She will have no federal tax liability and has not made any federal tax payments. c. Ty earned $2,500 this summer and had $200 of federal taxes withheld from his paycheck. He will have no federal tax liability this year. d. Startup Corporation had a $50,000 loss this year. e. The Walker Family Trust earned $500 of gross income this year.You are the tax supervisor at a local tax return preparation firm. Suzanne and her husband Steve have been working with the local fire department for 8 years. They have a total income after adjustments (reported on line 11 of the form 1040) of $160,000. After reviewing the preparation of the return, you notice there are a few things not taken into consideration for her tax return preparation. For each of the following questions, provide where the change on the tax return would occur and how much would it effect their taxable income, if they had an effective tax rate of 21% and a marginal tax rate of 24%, prior to the change. The ROTH IRA contribution of $7000 for each of Suzanne and Steve. (5PTS) Fertility treatment for Suzanne, so she should conceive a child. The process is still going on, but in 2020, they spent $15,000 on treatments and racked up 300 miles going back and forth to hospitals. (5PTS) They made a charitable contribution for the Fireman’s Fund,…Determine the amount of taxable income that should be reported by a cash-basis taxpayer in 2022 in each of the following independent cases: Required: a. A taxpayer completes $700 of accounting services in December 2022 for a client who pays for the accounting work in January 2023. b. A taxpayer is in the business of renting computers on a short-term basis. On December 1, 2022, she rents a computer for a $260 rental fee and receives a $650 deposit. The customer returns the computer and is refunded the deposit on December 20, 2022. c. Same facts as (b) except that the computer is returned on January 5, 2023. d. On December 18, 2022, a landlord rents an apartment for $625 per month and collects the first and last months' rent up front. It is customary that tenants apply the security deposit to their last month's rent upon moving out. e. An accountant agrees to perform $395 of tax services for an auto mechanic who has agreed to perform repairs on the car of the accountant's wife. The…