Stock

1. Boyd Smith acquires 100 shares of Evans Corporation stock for $3,000 on January 8, 2007. He gave the stock to his daughter Susan on January 8, 2008, when the fair market value was $2,400. On March 22, 2008, Susan sold the stock for $1,500. What is the nature and the amount of the gain or loss for Susan in 2008?

Tax

1.Jackie Smith had a fur coat that cost $12,000 when purchased in 1998 and that was worth $14,000 when it was stolen on April 15, 2008. Her t.v. which cost $800 in 2003 and was worth $600, was also stolen. She received $10,000 from her insurance company for the theft of the two items. On July 20, 2008, her summer cottage was a b ...continues

Partnerships – Formation and Operation

Frank Caster and George Wilson were equal partners of the F&G partnership, which reported its income on a fiscal year ending september 30. For fiscal year 2007-2008, the partnership's ordinary income was $30,000. It's ordinary income for the months of October-December 2008 was $9,000. The partneship was terminated on December 31 ...continues

Depreciation Expenses

Why does the U.S Government allow Depreciation Expenses? Is Depreciation benefiting to a tax payer? Why or Why not?

Capital Gains: Define Capital assets and the tax treatment of gains and losses

Define Capital assets and the tax treatment of Capital gains and losses. Is the capital gain tax different from the ordinary income tax?

Taxation

1. A company has income of $62,000 from operations and a net long-term capital loss of $5,000. What is the corporation's taxable income for the year? 2. What are the differences in the treatment of capital losses of corporations and of individuals?

Partnerships-Distributions, sales, and Exchanges

Mark, Pete and Mickey are equal partners in the 2MP Partnership. At the beginning of the year, Mark's basisin his partnership interest was $15,000, Pete's basis was $10,000, and Mickey's basis was $20,000. The partnership reported taxable income of $30,000 (allocated equally among the partners). At year end, the partnership made ...continues

Partneships-Distributions, Sales, and Exchanges

Craig received a cash distribution of $50,000 in liquidation of half of his one-fourth interest in White Family Partners. His tax basis in his partnership interest prior to the distribution was $35,000. The distribution was not a disproportionate distribution and the partnership had no liabilities. a. How much gain or loss mu ...continues

Partnerships-Distributions, Sales, and Exchanges

Edna was a one-third partner in OldGrad Partners until December 31, when her interest in the partnership was liquidated. Prior to the liquidation, her basis in her partnership interest was $45,000. She received $15,000 cash and property with a tax basis (to the partnership) of $50,000 and a fair market value of $64,000 in comple ...continues

Sole Proprietorship to LLC or C corporation

1. Your client has operated a sole proprietorship for several years and is now interested in reaising capital for expansion. He is considering forming either a C corporatoin or an LLC. a. Describe the treatment of an LLC and discuss any advantages the LLC offers over eht C corporation. b. Assume instead the clinet ha ...continues