Tax Problems: Chapter $6$: $6-57$

Using the following facts, determine Jaron$$s $2022$ taxable income.

$1.$ In November $2020,$ when his wife died, Jaron left the CPA firm he was working for and

started his own practice so he could have more time to spend with his four children $($ages

$14,16,19,$ and $24$ years old$).$ The three younger children live at home with their father.

Danny, Jaron$$s $19-$year$-$old son, graduated from high school a year ago and is currently working at a local golf course. Danny earned $$17,000$ in the current year. Jaron$$s oldest daughter, Laura, is married and lives in town with her husband, Chad. Laura graduated from college two years ago and now works for a local advertising agency.

$2.$ Jaron rents a small office downtown where he meets with clients and conducts business. He keeps all his client files and business records in this office. In the evening, he

uses a converted bedroom in his home as his office. The following expenses are allocated to his home office $($by square feet$)$:

Depreciation $$2,150$

Taxes $$1,500($$$3,600$ for non$-$office portion of his home$)$

Utilities $$75$

$3.$ Jaron owns a condominium downtown. He rented it out $270$ days during the year. He

also allowed Laura and her husband to stay in the home rent$-$free for $24$ days while they were looking for a home. Fortunately, the condominium was not rented during the time they needed it$.$ The following items of annual income and expense relate to the

condominium:

Rental income $$18,000$

Mortgage interest $($$$3,150)$

Taxes $($$$1,700)$

Other expenses $($$$6,000)$

Depreciation $($$$7,090)$

$4.$ On April $6,$ Jaron sold a parcel of land he had held for investment to a real estate

development firm for $$75,000.$ He purchased the land three years earlier from his

brother for $$70,000.$ His brother had originally purchased the land for $$74,000.$

$5.$ On May $1,$ Jaron purchased $1,000$ shares in Genomics Ltd$.$ for $$10$ per share. In December

he was forced to sell all $1,000$ shares at $$8$ per share to avoid a conflict of interest.