Tom owns 20% of a ptrsp in which he materially participates. Assume Tom's basis in a ptrsp is $6,300 at the beginning of the year. During the year the ptrsp incurs $50,000 in losses and its liabilities increase by $15,000. How much can Tom deduct? Assume Tom had $1,000 of passive income

Margaret Lindley paid $15,190 of interest on her $301,900 acquisition debt for her home (fair market value of $501,900), $4,190 of interest on her $30,190 home-equity debt used to buy a new boat and car, $1,190 of credit card interest, and $3,190 of margin interest for the purchase of stock. Assume that Margaret Lindley has $10,190 of interest income this year and no investment expenses. How much of the interest expense may she deduct this year? $23,760 $22,570 $19,380 $18,380 None of the choices are correct.

Vikram

Tracy and Jerome, equal shareholders in Macaw Corporation, receive $600,000 each in distributions on December 31 of the current year. Macaw's current-year taxable income is $1,000,000 and it has no accumulated E & P. Last year, Macaw sold an appreciated asset for $1,200,000 (basis of $400,000). Payment for one-half of the sale of the asset was made this year. How much of Tracy's distribution will be taxed as a dividend? Oa, $300,000- Ob. so Oc. $500,000 Od. $600,000

TPW, a calendar year taxpayer, sold land with a $549,000 tax basis for $845,000 in February. The purchaser paid $84,500 cash at closing and gave TPW an interest-bearing note for the $760,500 remaining price. In August, TPW received a $60,825 payment from the purchaser consisting of a $38,025 principal payment and a $22,800 interest payment. In the first year after the year of sale, TPW received payments totaling $116,650 from the purchaser. The total consisted of $76,050 principal payments and $40,600 interest payments. Required: For the first year after the year of sale, compute the difference between TPW’s book and tax income resulting from the installment sale method. Is this difference favorable or unfavorable? Using a 21 percent tax rate, determine the effect of the difference on the deferred tax asset or liability generated in the year of sale.

C sold capital property in Year 1 for net proceeds of $200,000. The property has an adjusted cost base of $40,000. C received $120,000 at the time of the sale and a note for the balance to be paid in equal annual instalments over the following two years. What is the minimum taxable capital gain to be reported in Year 2?

Josh has investments in two activities, these are his only two investments. Josh materially participates in Activity A (acquired three years ago). Activity A has $10.000 basis at the beginning of the year and produces a loss of $30,000 this year. Activity B is a passive activity for Josh. Activity B (acquired two years ago) has an $80,000 basis at the beginning of the year and produces a loss of $50,000. Neither activity is a publicly traded partnership. Josh has $100,000 of wage income. What is the total amount of Josh's suspended losses for the year? (enter whole dollars only, no minus sign (-) no dollar signs ($). no commas (.), or any other marks.)

Aiden is married and has salary income of $80,000 and total itemized deductions is $30,000. During the year, he sold two investments resulting in a $5,000 long-term capital gain and a $15,000 short-term capital loss. He calculated his AGI to be $70,000 (80,000 -10,000) and his taxable income to be $40,000 (70,000-30,000). Based on the tax formula and the net capital loss rules, comment on whether or not the adjusted gross income and taxable income are correct. Explain and provide support for your position.

Betty sells an interest in a passive activity for $100,000. Her adjusted basis is $70,000 and losses from prior years that were not deductible due to the passive activity loss restrictions total $40,000. The tax effects of the sale are: Gain $30,000 O Gain $60,000 O Loss $10,000 O No gain, No loss.

For the current year, Sarah has salary of 50,000. In addition, she has the following capital transactions: Long-term capital gain (15%)         12,000 Short-term capital gain                     8,000 Long-term capital loss (28%)          (4,000) Short-term capital loss                    (10,000)   What is her taxable income for the year? She has a short-term capital loss carry-over of 5,000 from the previous year. The standard deduction amount for her is 12,000