1. Betty is an unmarried attorney. During the year a hurricane completely destroys her home, which had a basis of $60,000. The value of her home before the tornado is $100,000 and the value afterwards is $35,000. Betty's home is located in a federally declared natural disaster area. Her AGI is $50,000. What is the amount that Betty can deduct after limitations?

Group of answer choices

$29,900.

$54,900.

$59,900.

$65,000.

1. Rachel purchased Blue Corporation stock for $10,000 in 2014. Rachel sells the stock to her sister, Erica, for $2,000 in 2018. In 2020, Erica sells the bonds for $25,000 to a non-relative. What is the amount of Erica's taxable gain?

Group of answer choices

$0.

$15,000.

$23,000.

$25,000.

1. Tom purchases 1,000 shares of Standard Corp. stock in 2017 for $31,000. On October 1, 2020, he sells the stock for only $10,000. On October 29, 2020 Tom buys 1,000 shares of Standard Corp. again for $10,000.How much of the October 1, 2020 loss may Tom deduct this year?

Group of answer choices

$0.

$3,000.

$21,000.

$31,000.

Sonya wants to become a Certified Public Accountant. Therefore, she decides to go to college and obtain a degree in accounting. What is the tax treatment of Sonya's educational expenses?

Group of answer choices

1. Sonya may not deduct the educational expenses as a business deduction.

Educational Expenses are never allowed a tax deduction.

Sonya may deduct the educational expenses because they are required for her to become an accountant.

Educational expenses are always allowed a business deduction.

1. Ross is a surgeon at a local hospital in Denver. In 2020, Ross earns a salary of $300,000. In addition, Ross has investment income of $10,000. Ross also has the following business activities below:

Active Income from Activity A: $30,000

Passive Income from Activity B: $20,000

Passive Loss from Activity C:(60,000)

Ross has sufficient at-risk amounts for any loss. What is Ross's 2020Adjusted Gross Income(AGI)?

Group of answer choices

$300,000.

$310,000.

$340,000.

$360,000.

1. Michael works as an accountant at a large accounting firm. Michael is also a partner in XYZ partnership. In 2020, Michael spends 240 hours working in XYZ. His business partner, Beth, only spends 210 hours working in the partnership. The partnership has no employees other than the two partners who contribute their time. Michael has materially participated in the partnership.

Group of answer choices

True

False