During 2019, Ms. Jessica Michaels was unemployed and had no income of any kind. In order to survive, she  sold a painting on December 1, 2019 for $78,000.  This painting  had been left to Ms. Michaels by her father and, at the time of his death, it had a fair market value of $102,000.

During 2020, Ms. Michaels finds a job and has employment income of $69,000.  In addition, during June,  she  sells  a  second  painting  for  $7,000.  She  had  purchased  this  painting  several  years  ago  for $1,100.  She has no other sources of income in 2020.

Determine Ms. Michaels’ Net Income For Tax Purposes and Taxable Income for 2020.  Indicate the amount and type of any losses available for carry forward at the end of the year.  Assume the December 1, 2019 sale had been of publicly traded shares instead of a painting.  How would this change your solution?

Answer rating: 100% (QA)

Ms Michaels will have a listed personal property loss carry forward from 2019 of 12000 12 78000 1020... View the full answer