25. Paul loaned his friend money to buy a home and has not been repaid as agreed. Which of the following is incorrectly shown as an item needed in a bad debt statement to the IRS? a) Description of the debt (amount and date due) b) Name of the deblor and any business or family relationship between the taxpayer and c) d) the deblor Efforts made by the taxpayer to collect the debt Copy of the loan agreement signed by the taxpayer and the debtor 26. Assuming Paul has the necessary documentation, where on his tax return does Paul report the nonbusiness bad debt? a) Line 21, Form 1040 b) Schedule A, miscellaneous itemized deductions c) As an adjustment on ine 36, Form 1040 d) Form 8949 as a short-term capital loss 27. Lonzo is single. He sold his house and connecting property in July for $395,000. The house was purchased in 1956 by Lonzo and his wife (now deceased) for $35,000. Lonzo's wife has been deceased for four years. Calculate the exclusion on the sale of Lonzo's house Lonzo completed the following work/purchases to the house during the time he lived there. Purchase of connecting property $30,000 $55,000 $ 800 S 4,250 15,000 Cleaned all plumbing pipes S 950 Repared heat pump nstalled central heat/ar Addition of 1,200 square feet In-ground pool Repaired slate shingles 2,000 a) $255,750 b) $260,000 c) $250,000 d) $396,000 28. Assume that Lonzo owned the property as rental property beginning in 1995. During the time the house was rental property, Lonzo had $16,000 in depreciation and completed the same work/purchases isted in the previous question. Calculate Lonzo's gain on the sale of the house a) $268,000 b) $271,750 c) $250,000 d) $255,750 29. To avoid paying taxes on the entire gain in the year of sale, Lonzo sold his rental property through an installment arrangement On which form is an installment sale first reported? a) Form 1040 b) Schedule D c) Form 4797 d) Form 6252