1. During the year, Addison is involved in the following transactions:

1. Lost money gambling on a recent trip to a casino.
2. Helped pay for her neighbors dental bills. The neighbor is a good friend who is unemployed.
3. Received from the IRS a tax refund due to Addisons overpayment of last years Federal income taxes.
4. Paid a traffic ticket received while double parking to attend a business meeting.
5. Contributed to the mayors reelection campaign. The mayor had promised Addison to have some of her land rezoned. The mayor was reelected and got Addisons land rezoned.
6. Borrowed money from a bank to make a down payment on an automobile.
7. Sold a houseboat and a camper on eBay. Both were personal use items, and the gain from one offset the loss from the other.
8. Paid for dependent grandfathers funeral expenses.

9 Paid premiums on her dependent sons life insurance policy.

What are the possible income tax ramifications of these transactions?

2. In late 2022, the Polks come to you for tax advice. They are considering selling some stock investments for a loss and making a contribution to a traditional IRA. In reviewing their situation, you note that they have large medical expenses and a casualty loss (in a Federally declared disaster area), neither of which is covered by insurance. What advice would you give the Polks?

3. In choosing between taking the standard deduction and itemizing deductions from AGI, what effect, if any, does each of the following have?

1. The age of the taxpayer(s).
2. The health (i.e., physical condition) of the taxpayer.
3. Whether taxpayers rent or own their residence.
4. Taxpayers filing status (e.g., single, married, filing jointly).
5. Whether married taxpayers decide to file separate returns.
6. The taxpayers uninsured personal residence that was recently destroyed by a wildfire (the region was declared a disaster area by the Federal government).
7. The number of dependents the taxpayer can claim.