you ask Sally and Jim if they sold any assets this year. They provide you with...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
you ask Sally and Jim if they sold any assets this year. They provide you with the following: • Sally and Jim have an investment account and report a ($10,000) net short-term capital loss on the sale of stock and a net long-term capital gain of $5,000 on the sale of stock. In addition, the investment account reports they earned $3,500 of qualified dividends. • In December of the current tax year, Sally and Jim sold their home. This home was their primary residence that they had lived in for the last 15 years. They calculated that the gain on the sale of their home was $515,000. ($1,000,000 sales price less $485,000 adjusted tax basis). • Sally and Jim sold a coin collection for $45,000. They had inherited the coin collection in three years ago when a relative passed away and the coin collection had an FMV of $40,000. The relative had originally purchased the coin collection for $35,000 in 2005. • Sally and Jim also sold one of their personal vehicles. They had originally purchased the vehicle in a decade ago for $35,000. They sold it this year for $12,000. • In the current tax year, Sally and Jim sold stock to Sally's sister Kelly for $25,000 (the fair market value). They had originally purchased the stock in 2004 for $27,000. On January 10, 2023 Sally and Jim sold 1,000 shares of XYZ Corp. stock for $50,000. They had originally purchased the stock in 2016 for $51,000. On January 20, 2023 they decided they liked that stock and decide to buy back 250 shares of XYZ Corp. stock for $15,000. • Finally, Jim informs you that he sold two assets used in his business this year. o Jim sold land purchased in 2005 for $200,000 and sold for $225,000 Jim also sold equipment purchased in 2019 for $75,000 with A/D of $75,000 (fully depreciated) and sold for $10,000. Within the last five years, Jim had previously sold one business asset and incurred a ($3,000) §1231 loss. Jim has not sold any other business assets in any previous years. a. Calculate the recognized gain/loss for each disposition. Organize and complete the §1231 and Capital Gains netting procedures. Show all work and round all numbers to the nearest dollar. §1231 Short-Term Ordinary Long-Term 28% Long-Term 25% Long-Term 0/15/20% b. Complete the table below to indicate the total amount of income from question 4 to be reported in AGI by character. Character of Income Amount Included in AGI Ordinary 25% 28% 0/15/20% Total: you ask Sally and Jim if they sold any assets this year. They provide you with the following: • Sally and Jim have an investment account and report a ($10,000) net short-term capital loss on the sale of stock and a net long-term capital gain of $5,000 on the sale of stock. In addition, the investment account reports they earned $3,500 of qualified dividends. • In December of the current tax year, Sally and Jim sold their home. This home was their primary residence that they had lived in for the last 15 years. They calculated that the gain on the sale of their home was $515,000. ($1,000,000 sales price less $485,000 adjusted tax basis). • Sally and Jim sold a coin collection for $45,000. They had inherited the coin collection in three years ago when a relative passed away and the coin collection had an FMV of $40,000. The relative had originally purchased the coin collection for $35,000 in 2005. • Sally and Jim also sold one of their personal vehicles. They had originally purchased the vehicle in a decade ago for $35,000. They sold it this year for $12,000. • In the current tax year, Sally and Jim sold stock to Sally's sister Kelly for $25,000 (the fair market value). They had originally purchased the stock in 2004 for $27,000. On January 10, 2023 Sally and Jim sold 1,000 shares of XYZ Corp. stock for $50,000. They had originally purchased the stock in 2016 for $51,000. On January 20, 2023 they decided they liked that stock and decide to buy back 250 shares of XYZ Corp. stock for $15,000. • Finally, Jim informs you that he sold two assets used in his business this year. o Jim sold land purchased in 2005 for $200,000 and sold for $225,000 Jim also sold equipment purchased in 2019 for $75,000 with A/D of $75,000 (fully depreciated) and sold for $10,000. Within the last five years, Jim had previously sold one business asset and incurred a ($3,000) §1231 loss. Jim has not sold any other business assets in any previous years. a. Calculate the recognized gain/loss for each disposition. Organize and complete the §1231 and Capital Gains netting procedures. Show all work and round all numbers to the nearest dollar. §1231 Short-Term Ordinary Long-Term 28% Long-Term 25% Long-Term 0/15/20% b. Complete the table below to indicate the total amount of income from question 4 to be reported in AGI by character. Character of Income Amount Included in AGI Ordinary 25% 28% 0/15/20% Total:
Expert Answer:
Answer rating: 100% (QA)
Calculating Recognized GainsLosses and Completing Netting Procedures 1 Organize Assets and Dispositi... View the full answer
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
Posted Date:
Students also viewed these law questions
-
Read the case study "Southwest Airlines," found in Part 2 of your textbook. Review the "Guide to Case Analysis" found on pp. CA1 - CA11 of your textbook. (This guide follows the last case in the...
-
The Crazy Eddie fraud may appear smaller and gentler than the massive billion-dollar frauds exposed in recent times, such as Bernie Madoffs Ponzi scheme, frauds in the subprime mortgage market, the...
-
Consider Problem 13.28. The solvent MDEA becomes rich in acid gases. To recycle this solvent, it is first heated to 90C in exchanger E-2001 and then sent to the top stage of the stripper T-2002 as...
-
Hercules Poirot began operations as a private investigator on January 1, 2017. The trial balance columns of the worksheet for Hercules Poirot, P.I., SA at March 31 are as follows. Other data: 1....
-
Saks Fifth Avenues balance sheet for a recent year revealed the following information: Current assets ...................................... $750,000 Noncurrent assets...
-
Explain the difference between the STRIPS language and the ADL language. Why is ADL described as being more expressive than STRIPS? What kinds of problems might ADL be used to solve for which STRIPS...
-
In its income statement for the year ended December 31, 2014, Michael Company reported the following condensed data. Instructions (a) Prepare a multiple-step income statement. (b) Prepare a...
-
Marginal cost function C ' ( q ) is given in the figure below. If the fixed costs are $ 1 0 , 0 0 0 , estimate the following. $ / unit 3 0 2 4 1 8 1 2 - C ' ( q ) 1 5 3 0 4 5 6 0 7 5 ...
-
EyeGuard Equipment Inc. (EEI) manufactures protective eyewear for use in commercial and home applications. The product is also used by hunters, home woodworking hobbyists, and in other applications....
-
In order to pay her credit card bills from the Christmas shopping season, Natasha decides to sell her entire holding of one share of Teeesla Inc., which is a famous electric car manufacturer. The...
-
13 4. Two masses m = 6.0 kg are connected together by a massless string which is strung over a massless, frictionless pulley. The masses are released from rest and accelerate as shown below. 3.0 kg...
-
I. INTRODUCTION Assume that you are an economic consultant hired by an international organization/government to provide your expert advice on economic conditions pertaining to the United States and...
-
On the 23rd March 2023, the US government announced that it will buy back up to $25,000,000 face value Treasury bonds, from five particular bond series currently on issue. The announcement extract...
-
1. Calculate the expected return (sample arithmetic mean) and sample standard deviation of returns of each asset class. Also calculate the sample geometric mean average historical rate of return for...
-
The stress-strain diagram for a ductile material is determined by a tensile test and shown in the figure below. The original diameter of the specimen is measured to be 0.25 in and the original...
-
Tommy sue Movie theater for the ad before the movie start. If 10 or more % people agree with Tommy then the corporation will seriously consider negotiating any lawsuit filed by Tommy. If less than...
-
Discuss the information available from the following techniques in the analysis of inorganic pigments used in antique oil paintings: (i) Powder X-ray diffraction, (ii) Infrared and Raman...
-
Bill and Guilda each own 50 percent of the stock of Radiata Corporation, an S corporation. Guilda's basis in her stock is $25,000. On July 31, 2012, Bill sells his stock, with a basis of $40,000, to...
-
Russell (age 50) and Linda (age 45) Long have brought you the following information regarding their income and expenses for the current year. Russell owns and operates a landscaping business called...
-
Karim Depak received a Form 1099-B showing the following stock transactions and basis during 2012: None of the stock is qualified small business stock. Calculate Karim's net capital gain or loss...
-
True or False. The system stiffness matrix is always singular unless the boundary conditions are incorporated.
-
Derive the stiffness and mass matrices of the planar frame element (general beam element) shown in Fig. 12.16 in the global \(X Y\)-coordinate system. Y U U3 U Joint 1 Joint 2 U6 Us UA FIGURE 12.16 A...
-
Fill in the Blank. The displacement within a finite element is expressed in terms of _____________ functions.
Study smarter with the SolutionInn App