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Question;83. Ms. Plant owns and actively manages an apartment;complex. This year, the complex generated a $32,790;net loss. If Ms. Plant's AGI before considering this loss is;$196,100, and she owns no other passive;activities, how much of the loss is deductible this year?;A. $0;B. $25,000;C. $32,790;D. None of the above;84. Mr. Vernon owns stock in two S corporations, Able;Corporation and Benson Inc. This year, Mr. Vernon;had the following income and loss items.;If Vernon materially participates in Able's business but not;in Benson's business, compute his AGI.;A. $94,000;B. $74,000;C. $61,000;D. $41,000;85. Ms. Watts owns stock in two S corporations, MKP;Corporation and Reynolds Inc. This year, Ms. Watts;had the following income and loss items.;If Ms. Watts materially participates in the business of both;corporations, compute her AGI.;A. $85,700;B. $113,700;C. $127,700;D. $155,700;86. Ms. Cowler owns stock in Serzo Inc., an S corporation;and an interest in OTW Partnership. This year;Ms. Cowler had the following income and loss items.;If Ms. Cowler's interests in Serzo and OTW are passive;activities, compute her AGI.;A. $68,000;B. $65,600;C. $85,000;D. $66,800;87. Mr. and Mrs. Nelson operate a small business as a sole;proprietorship. This year, they have the following;tax information.;A. $50,900;B. $47,367;C. $50,147;D. None of the above;88. In 2010, Mr. Margot purchased a limited interest in a;business partnership, which is her only passive;activity. In 2010, she was allocated $14,900 of the;partnership's ordinary business loss. In 2011, she was;allocated $7,700 of the partnership's ordinary business;income. Which of the following statements is;false?;A. In 2010, Mr. Margot could not deduct any of her allocated;partnership loss.;B. In 2011. Mr. Margot can deduct $7,700 of the 2010 loss.;C. Mr. Margot has a $7,200 passive activity loss;carryforward into 2012.;D. None of the above statements is false.;89. Mr. and Mrs. Perry own stock in an S corporation, which;is their only passive activity. They have an;$8,200 passive activity loss carryforward into 2011. In;2011, the Perrys are allocated a $1,600 share of;corporate ordinary business income. Late in 2011, they;recognize a $3,500 long-term capital gain on the;sale of their entire stock interest. How much of their loss;carryforward can the Perrys deduct in 2011?;A. $0;B. $5,100;C. $8,200;D. $1,600;90. Ms. Poppe, a single taxpayer, made the three gifts this;year. She gave $6,300 cash to her niece to fund a;summer vacation in Europe, $50,000 cash to Yale University;which is her alma mater, 50,000 acres of;land to her brother. Ms. Poppe's tax basis in the land was;$400,000, and its fair market value of date of;gift was $615,000. Compute Ms. Poppe's taxable gifts for the;year.;A. $387,000;B. $602,000;C. $621,300;D. $639,000;91. Mr. and Mrs. Gupta want to make cash gifts to each of;their four children, the children's four spouses, and;three grandchildren (11 donees). Compute the total amount;that the Guptas can transfer to their youngergeneration;family members without making a taxable gift for the year.;A. $91,000;B. $182,000;C. $143,000;D. $286,000;92. Bess gave her grandson ten acres of undeveloped land.;Bess' tax basis in the land was $35,000, and its;fair market value at date of gift was $175,000. Two years;after receiving the land, the grandson sold it for;$200,000. Compute his recognized gain on sale.;A. $0;B. $25,000;C. $165,000;D. $200,000;93. Mr. Lee made the following transfers this year. Which of;the transfers are treated as gifts for federal tax;purposes?;A. Political contribution to the Democratic party;B. Charitable contribution to the United Way;C. Payment to a hospital for the medical expenses of his;39-year old son;D. None of the above are treated as gifts.;94. Which of the following statements about the federal gift;tax is false?;A. The tax is imposed on the donor.;B. The tax is based on the fair market value of the gifted;property.;C. An individual can give away $5 million every year without;being subject to tax.;D. The donor's basis in the gifted property carries over to;become the donee's basis.;95. Which of the following are included in a decedent's;taxable estate?;A. Real property owned by the decedent and included in the;probate estate.;B. Proceeds of a life insurance policy on the decedent's;life if the decedent owned the policy.;C.;An individual retirement account owned by the decedent and;payable to the beneficiary named in the;account.;D. All of the above are included.;96. Which of the following reduce a decedent's taxable estate?;A. The decedent's funeral expenses.;B. Testamentary transfers to charitable organizations.;C. Testamentary transfers to the decedent's spouse.;D. Testamentary transfers to the decedent's children.;97. Mrs. Heyer inherited real estate from her mother. The;mother's basis in the real estate was $382,000, and;the fair market value at the date of the mother's death was;$900,000. The mother's taxable estate was only;$2.4 million, so the estate did not owe any federal estate;tax. This year, Mrs. Heyer sold the real estate for;$875,000. Compute her gain or loss recognized on sale.;A. $0;B. $25,000 loss;C. $493,000 gain;D. $875,000 gain;98. Mr. Lainson died in 2010 when the total FMV of his;property was $12 million and his debts totaled;$450,000. His executor paid $15,000 of funeral expenses and;$50,000 of accounting and legal fees to;settle the estate. Mr. Lainson bequeathed $1 million to;Villanova University, $200,000 to the Lutheran;church, and $3 million to his surviving wife. He left the;remainder of the estate to his children. Compute;Mr. Lainson's taxable estate.;A. $10,285,000;B. $6,850,000;C. $6,800,000;D. $6,785,000;99. Mr. McCann died in 2011. During his lifetime, he made;taxable gifts significantly in excess of his $5;million lifetime exclusion. Mr. McCann's taxable estate was;$12.9 million. Compute the estate tax on this;estate.;A. $4.515 million;B. $5.805 million;C. $5.355 million;D. $4.23 million;100.In 2009, Mr. Yang paid $160,000 for a corporate bond;with a $200,000 stated redemption value. Based;on the bond's yield to maturity, amortization of the $40,000;discount was $3,024 in 2009 and $2,960;in 2010. Mr. Yang sold the bond for $169,500 in 2011. What;are his tax consequences in each year;assuming that;a. He bought the newly issued bond from the corporation?;b. He bought the bond in the public market through his;broker?;101.Beverly earned a $75,000 salary and recognized a $7,200;loss on the sale of corporate stock this year.;Compute her AGI in each of the following independent cases.;a. Beverly had no other capital transactions this year.;b. Beverly recognized a $13,500 capital gain on the sale of;mutual fund shares.;c. Beverly received a $9,500 capital gain distribution from;a mutual fund and had a $3,200 capital loss;carryforward from a previous year.;102.Mr. Carp, a single taxpayer, recognized a $44,000;long-term capital gain, a $12,000 short-term capital;gain, and a $10,000 long-term capital loss. Compute Mr.;Carp's tax if his taxable income before;consideration of his capital transactions is $405,000.;103.Ms. Mollani owns stock in two S corporations, Aloha and;Honu. This year, she had the following income;and loss items;Compute Sheila's AGI under each of the following;assumptions.;a. She materially participates in Aloha's business but not;in Honu's business.;b. She materially participates in Honu's business but not in;Aloha's business.;c. She materially participates in both corporate businesses.;d. She does not materially participate in either business.;104.Mr. Ames, an unmarried individual, made a gift of real;estate to his nephew. Compute the amount subject;to the federal gift tax in each of the following situations.;a. FMV of the real estate was $1,800,000, and the transfer;was Mr. Ames first taxable gift.;b. FMV of the real estate was $7,250,000 and the transfer;was Mr. Ames first taxable gift.;c. FMV of the real estate was $2,300,000. Two years ago, Mr.;Ames made his first taxable gift of;marketable securities with a $3,920,000 FMV in excess of the;annual exclusion.


Paper#44679 | Written in 18-Jul-2015

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