Charles and Cynthia divorced at the end of 2021. Under the terms of the divorce decree,...
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Charles and Cynthia divorced at the end of 2021. Under the terms of the divorce decree, Charles is required to pay Cynthia $25,000 in cash in 2022, and another $25,000 in each of the next four years (or until Cynthia's death or remarriage). In addition, Charles must transfer assets worth $800,000 (cost basis of $700,000) to Cynthia and pay $12,000 per year to support their son until the age of 18. Assuming that Charles pays the required amounts, what amount of gross income must Cynthia report in 2022 as a result of the divorce? $125,000 $25,000 $0 $825,000 $37,000 Charles and Cynthia divorced at the end of 2021. Under the terms of the divorce decree, Charles is required to pay Cynthia $25,000 in cash in 2022, and another $25,000 in each of the next four years (or until Cynthia's death or remarriage). In addition, Charles must transfer assets worth $800,000 (cost basis of $700,000) to Cynthia and pay $12,000 per year to support their son until the age of 18. Assuming that Charles pays the required amounts, what amount of gross income must Cynthia report in 2022 as a result of the divorce? $125,000 $25,000 $0 $825,000 $37,000
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Answer 25000 Explanation In the 2022 report Cynthia reports 25000 as gross income because ... View the full answer
Related Book For
Federal Tax Research
ISBN: 9781285439396
10th Edition
Authors: Roby Sawyers, William Raabe, Gerald Whittenburg, Steven Gill
Posted Date:
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