c. Loss on Sale of Related Party d. Realized gain on a like-kind exchange 7. A Worthless Security Loss may be taken on a corporate stock trading on the NYSE after a. Net Operating Losses b. Chapter 11 Bankruptcy d. Related Party Loss 8. A partner's losses taken in a partnership are limited by a. Accumulated dividends b. At Risk c. Chapter 11 d. Capital gains Jennifer contributed property with a $48,000 basis and a Maple partnership in exchange for a 30% interest in the partnership capital and profits. During the first year of the partnership operations, Maple had net taxable income of exempt income of $80,000. The partnership distributed $40,000 cash to Jennifer. Her share of partnership recourse liabilitieis on the last day of the partnership year was $30, adjusted basis (outside basis) for her partnership interest at year-end is 9. fair market value of $100,000 to the $40,000 and tax 000. Jennifer's a. $114,000 b. $53,000 C. $62,000 d. $74,000 10. When a loss is disallowed under the wash sale rule, the amount of loss disallowed is a. b. c. d. Carried back 2 years and forward 5 years Added into the basis of new stock acquired Gone forever Reduced by the deprecation amount 11. The Supreme Court has noted that the primary goal of the income tax system is the equitable collection of revenue, while the primary goal of financial accounting most closely is associated with Over-estimating income so that tax revenues are maximized. Allowing small businesses the opportunity to elect the cash basis method of reporting Provide investors and other interested parties with enough information so that they are not misled. Provide that the fruit is subjugated to the tree it comes from a. b. c. d. 12. Deductions are not allowed unless specific provisions in the tax law allow such deductions. a. True b. False