Problem 2 Determine AGI John and Sarah Connors are married for all of 2023. During the year they report the following receipts and expenditures. Item Receipts Wages from Skynt for John Amout 100,000 Wages from Botle, Inc For Sarah 50,000 Revenues from Bergamont Consulting - Sarah's Business 50,000 Interest from investments in corporate bonds 3,000 Sale of YRM, Ltd 60,000 Expenditures Related to Bergamont Consulting Wages for employees Legal Fees Traffic tickets 30,000 20,000 10,000 Other Expenses State and Local income taxes 8,000 Mortgage Interest on Principal Residence (Average balance of $700,000) 25,000 Student Loan Interest 2,000 OTHER INFORMATION 1. Sarah's at-risk basis in Bergamont consulting, of which she is the sole proprietor, at the beginning of the year is $20,000. There are no suspended losses. She has always run the business for personal pleasure. 2. During the year the Connors sell 100% of their interest in YRM, Ltd, a passive activity. At the time of the sale the investment and an adjusted basis of $15,000. 3. They made the maximum allowable contribution to their traditional IRA in 2023. Neither of them are active participants in their employer's retirement plan 4. The taxpayers itemize their deductions. Required: What is the Connor's AGI for 2023?
Problem 2 Determine AGI John and Sarah Connors are married for all of 2023. During the year they report the following receipts and expenditures. Item Receipts Wages from Skynt for John Amout 100,000 Wages from Botle, Inc For Sarah 50,000 Revenues from Bergamont Consulting - Sarah's Business 50,000 Interest from investments in corporate bonds 3,000 Sale of YRM, Ltd 60,000 Expenditures Related to Bergamont Consulting Wages for employees Legal Fees Traffic tickets 30,000 20,000 10,000 Other Expenses State and Local income taxes 8,000 Mortgage Interest on Principal Residence (Average balance of $700,000) 25,000 Student Loan Interest 2,000 OTHER INFORMATION 1. Sarah's at-risk basis in Bergamont consulting, of which she is the sole proprietor, at the beginning of the year is $20,000. There are no suspended losses. She has always run the business for personal pleasure. 2. During the year the Connors sell 100% of their interest in YRM, Ltd, a passive activity. At the time of the sale the investment and an adjusted basis of $15,000. 3. They made the maximum allowable contribution to their traditional IRA in 2023. Neither of them are active participants in their employer's retirement plan 4. The taxpayers itemize their deductions. Required: What is the Connor's AGI for 2023?
Chapter4: Income Exclusions
Section: Chapter Questions
Problem 55P
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Transcribed Image Text:Problem 2 Determine AGI
John and Sarah Connors are married for all of 2023. During the year they report the following receipts and expenditures.
Item
Receipts
Wages from Skynt for John
Amout
100,000
Wages from Botle, Inc For Sarah
50,000
Revenues from Bergamont Consulting - Sarah's Business.
50,000
Interest from investments in corporate bonds
3,000
Sale of YRM, Ltd
Expenditures
Related to Bergamont Consulting
Wages for employees
Legal Fees
Traffic tickets
60,000
30,000
20,000
10,000
Other Expenses
State and Local income taxes
8,000
Mortgage Interest on Principal Residence (Average balance
of $700,000)
25,000
Student Loan Interest
2,000
OTHER INFORMATION
1. Sarah's at-risk basis in Bergamont consulting, of which she is the sole proprietor, at the beginning of the year is $20,000. There are no suspended losses. She has always run the business for personal
pleasure.
2. During the year the Connors sell 100% of their interest in YRM, Ltd, a passive activity. At the time of the sale the investment and an adjusted basis of $15,000.
3. They made the maximum allowable contribution to their traditional IRA in 2023. Neither of them are active participants in their employer's retirement plan
4. The taxpayers itemize their deductions.
Required: What is the Connor's AGI for 2023?
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