9, Nicole, who is self-employed, uses her automobile 80% for business. During 2018, she drove a total of 10,000 business miles. Car expenses are listed below Business parking (all business relate), $100 Auto insurance, gas, oil, repairs, $1,500 Tolls (all business-related), $200 Depreciation, $2,000 Fines for traffic violations (incurred during business use), $300. What is Nicole's auto deduction if she uses the actual cost method a. $3,040 b. $3,100 c. $3,280 d. $4,100 e. $5,450 10. The QBI deduction: (1) applies to the QBI generated through a sole proprietorship (2) applies to the QBI generated through a corporation (3) is equal to 20% x the lesser ofOBI or modified taxable income (4) accountants and lawyers can never qualify for the deduction d. 1.3 and 4 are correcet all of the above are correct 1 and 3 are correct 2 and 4 arc correet a. b. o. 2 and 3 are correct e. 1. Which of the following statements about itemized deductions is true? 1. Judy paid S140 for a ticket to a Girl Scout dinner. The dinner was valued at $40. Judy may only claim a S100 charitable contribution deduction. 2. Lisa is a lawyer; she bills her clients $200 per hour. She donated 2 hours of her legal services to the local Boys and Girls Club. Lisa has an allowable charitable contribution of $400. 3. During the year, Victor spent $300 on bingo games sponsored by his church. Victor has a charitable contribution deduction of S300. . For graduation from college, Adrienne treats herself to a breast enhancement. The cost of this proce eductible as a medical expense Dan takes daily vitamins. The cost of the vitamins is deductible as a medical expense. d. 4 h of the following statements is false? x credit is a dollar for dollar reduction of a taxpayer's tax liability. refiundable credits are those that reduce the taxpayer's tax liability but are not paid w it (or credits) exceeds the taxpayer's tax liability. payer's earned income credit is dependent on the number of his or her qualifying C. None of the above. f the following factors indicate d. Indicate whether the sentence or statement is true or Jose ach1 26 polnts) - Allocate 20 minutes for thie (a is TRUE, b ts FALSE tock (worth $11,000) as a gi basis in the stock is $7.000 it from his aunt. His aunt's adjusted basis is $7,000. Perrin's 15 property with a FMV on the date of death of $10,000 fronm buss in te property was ss.ooo. Gustavo's basis in the property is SIWW. his great-great Aunt. His Aunt's 16. Janet and Bill, married couple filing a joing tax return, sell their current S165,000) for $450,000. They have owned and lived in the house for 30 ycars. l residence (adjusted basis of Under &121 of the IRC, the couple's realized gain is $262,500 and their recognized gain would be sT2,300 17. A self-employed taxpayer drove his car 10.000 miles and incurred $100 in business parking and tolls. If he uses the automatic mileage method to compute auto expenses in 2018, his total deduction wil be ss 18. In the current year, Kenny has a $35,000 loss from a real estate rental activity. If Kenny is participant, he may be able to deduct up to 530,000 of the loss, depending on his AG You enjoyed hearing about the Professors real life tax examples in class this semester! 19. t of income from all of the taxpayers passive activities. Any unused passive losses are suspended and carried forward to future years to offset. Dylan invested $18,000 in a horse breeding business, in which he materially participates (active income With respect to the home mortgage interest deduction, the amount of acquisition indebtedness is limited passive income in those years. Dylan's share of the loss for 2018 is $26,000. He can deduct $26,000 on his 2018 tax return. 22. based on when the debt was incurred. Under the TCJA, if the debt is incurred after December 15,2017, and before January 1, 2026, acquisition indebtedness is limited to $1,000,000. Short term capital gains are taxed at special rtes: 0%, 15% and 20%. 23. in Maui. He purchased a building lot, sold the building lot, and with short period of time, purchased another property. Section 1031 of the IRC allowed her friend to defer p taxes on the gain on the sale of the first building lot. In July 2018, Carol purchases 100 shares of stock of Bratty Toys, Inc., for $10,000 cach. On Decem 25. 2018, the stock is worth $8,000. Carol has a recognized loss of $2,000. so long as they exceed 2% ofl income. r rehurn 9, Nicole, who is self-employed, uses her automobile 80% for business. During 2018, she drove a total of 10,000 business miles. Car expenses are listed below Business parking (all business relate), $100 Auto insurance, gas, oil, repairs, $1,500 Tolls (all business-related), $200 Depreciation, $2,000 Fines for traffic violations (incurred during business use), $300. What is Nicole's auto deduction if she uses the actual cost method a. $3,040 b. $3,100 c. $3,280 d. $4,100 e. $5,450 10. The QBI deduction: (1) applies to the QBI generated through a sole proprietorship (2) applies to the QBI generated through a corporation (3) is equal to 20% x the lesser ofOBI or modified taxable income (4) accountants and lawyers can never qualify for the deduction d. 1.3 and 4 are correcet all of the above are correct 1 and 3 are correct 2 and 4 arc correet a. b. o. 2 and 3 are correct e. 1. Which of the following statements about itemized deductions is true? 1. Judy paid S140 for a ticket to a Girl Scout dinner. The dinner was valued at $40. Judy may only claim a S100 charitable contribution deduction. 2. Lisa is a lawyer; she bills her clients $200 per hour. She donated 2 hours of her legal services to the local Boys and Girls Club. Lisa has an allowable charitable contribution of $400. 3. During the year, Victor spent $300 on bingo games sponsored by his church. Victor has a charitable contribution deduction of S300. . For graduation from college, Adrienne treats herself to a breast enhancement. The cost of this proce eductible as a medical expense Dan takes daily vitamins. The cost of the vitamins is deductible as a medical expense. d. 4 h of the following statements is false? x credit is a dollar for dollar reduction of a taxpayer's tax liability. refiundable credits are those that reduce the taxpayer's tax liability but are not paid w it (or credits) exceeds the taxpayer's tax liability. payer's earned income credit is dependent on the number of his or her qualifying C. None of the above. f the following factors indicate d. Indicate whether the sentence or statement is true or Jose ach1 26 polnts) - Allocate 20 minutes for thie (a is TRUE, b ts FALSE tock (worth $11,000) as a gi basis in the stock is $7.000 it from his aunt. His aunt's adjusted basis is $7,000. Perrin's 15 property with a FMV on the date of death of $10,000 fronm buss in te property was ss.ooo. Gustavo's basis in the property is SIWW. his great-great Aunt. His Aunt's 16. Janet and Bill, married couple filing a joing tax return, sell their current S165,000) for $450,000. They have owned and lived in the house for 30 ycars. l residence (adjusted basis of Under &121 of the IRC, the couple's realized gain is $262,500 and their recognized gain would be sT2,300 17. A self-employed taxpayer drove his car 10.000 miles and incurred $100 in business parking and tolls. If he uses the automatic mileage method to compute auto expenses in 2018, his total deduction wil be ss 18. In the current year, Kenny has a $35,000 loss from a real estate rental activity. If Kenny is participant, he may be able to deduct up to 530,000 of the loss, depending on his AG You enjoyed hearing about the Professors real life tax examples in class this semester! 19. t of income from all of the taxpayers passive activities. Any unused passive losses are suspended and carried forward to future years to offset. Dylan invested $18,000 in a horse breeding business, in which he materially participates (active income With respect to the home mortgage interest deduction, the amount of acquisition indebtedness is limited passive income in those years. Dylan's share of the loss for 2018 is $26,000. He can deduct $26,000 on his 2018 tax return. 22. based on when the debt was incurred. Under the TCJA, if the debt is incurred after December 15,2017, and before January 1, 2026, acquisition indebtedness is limited to $1,000,000. Short term capital gains are taxed at special rtes: 0%, 15% and 20%. 23. in Maui. He purchased a building lot, sold the building lot, and with short period of time, purchased another property. Section 1031 of the IRC allowed her friend to defer p taxes on the gain on the sale of the first building lot. In July 2018, Carol purchases 100 shares of stock of Bratty Toys, Inc., for $10,000 cach. On Decem 25. 2018, the stock is worth $8,000. Carol has a recognized loss of $2,000. so long as they exceed 2% ofl income. r rehurn