LO.7 During 2012, Ron and his wife, Sue, had the following items of income and expense to report:

Farming income $300,000 Farming expenses 350,000 Interest income 6,000 Medical expenses (after 7.5%-of-AGI reduction) 12,000 Casualty loss (after $100 reduction and 10%-of-AGI reduction) 20,000

a. Determine Ron and Sue’s taxable income for 2012.

b. Determine Ron and Sue’s NOL for 2012.

c. Determine Ron and Sue’s farming loss for 2012.

d. To what years can Ron and Sue’s NOL be carried?