1. Complete the following table for the amount of the qualified business income deduction (QBID)for a taxpayer who files married filing joint. TI stands for taxable income; W2 is W-2 wages paid by the business. UBIA is unadjusted basis immediately after acquisition with respect to the business. CG is capital gain income. QBI is qualified business income. Service? Is followed by "yes" or "no" to indicate whether the business is a service business or not.28points - 2 points each.

2.In EACH of the following situations the taxpayer is in the highest marginal tax bracket, which you should assume means 37% for ordinary income, 20% for net capital gains, and 25% for unrecaptured section 1250 gains. Showin the table belowthe amount of income, and the amount of that incometaxed at each rate (25points):

a.The taxpayer purchases equipment for use in his business. The purchase cost is $120,000 and the entire amount is expensed using the Section 179 expense election. The asset is sold 3 years later for $60,000.

b.The taxpayer purchases equipment for use in his business. The purchase cost is $120,000 and the entire amount is expensed using the Section 179 expense election. The asset is sold 3 years later for $160,000.

c.The taxpayer purchases a building for use in his business. The purchase cost is $1,200,000 and in the 8 years the property is used $250,000 of cost recovery deductions are claimed. The building is sold for $1,800,000.

d.The taxpayer purchases a building for use in his business. The purchase cost is $1,200,000 and in the 8 years the property is used $250,000 of cost recovery deductions are claimed. The building is sold for $1,800,000.

e.The taxpayer purchases a building for use in his business. The purchase cost is $1,200,000 and in the 8 years the property is used $250,000 of cost recovery deductions are claimed. The building is sold for $1,800,000.