Deidre is single and has dividend income of $7,500 and a $6,000 long-term capital gain. She pays

Question:

Deidre is single and has income of $7,500 and a $6,000 long-term capital gain. She pays $9,000 of investment interest expense. The interest expense relates to all the assets in her portfolio. Deidre has no tax-exempt income, and her marginal tax rate is 33%.
Identify the tax issue(s) posed by the facts presented. Determine the possible tax consequences of each issue that you identify.

Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...