Question: On January 2 , 2 0 2 3 , Tim purchased a bond paying interest at 6 % for $ 3 0 , 0 0

On January 2,2023, Tim purchased a bond paying interest at 6% for $30,000. On March 31,2023, he gave the bond to Jane. The bond pays $1,800 interest on December 31. Tim and Jane are cash basis taxpayers. When Jane collects the interest in December 2023:
a. Jane must report $1,800 gross income.
b. Jane reports $1,350 of interest income, and Tim reports $450 of interest income.
c. Jane reports $450 of interest income, and Tim reports $1,350 of interest income.
d. Tim must include all of the interest in his gross income.

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