Last year Acme paid Ralph $15,000 to install a new air-conditioning unit at its headquarters building. The
Question:
a. Is Ralph required to include the $15,000 payment he received last year in his gross income from last year?
b. What are the tax implications of the repayment if Ralph was in the 35 percent tax bracket when he received the $15,000 payment from Acme, but was in the 28 percent tax bracket when he refunded $5,000 to Acme?
c. How would you answer part b. if Ralph refunded $2,500 to Acme and not $5,000?
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Related Book For
Taxation Of Individuals And Business Entities 2015
ISBN: 9780077862367
6th Edition
Authors: Brian Spilker, Benjamin Ayers, John Robinson, Edmund Outslay, Ronald Worsham, John Barrick, Connie Weaver
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