Question
Comprehensive Problem(TAX RETURN PROBLEM) Bill and Alice, husband and wife and both age 42, have the following transactions during 2020: a) They sold their old
Comprehensive Problem(TAX RETURN PROBLEM)
Bill and Alice, husband and wife and both age 42, have the following transactions during 2020:
a) They sold their old residence on Jan. 28,2020 for $380,000. The basis of their old residence, purchased in 2010, was $70,000. The selling expenses were $20,000. On May 17,2020, they purchased and moved into another residence costing $150,000.
b) On April 28,2020, they sold for $8,000 stock that Alice had received as a gift from her mother, who had purchased the stock for $10,000 in 2015. Her mother gave Alice the stock on November 15,2019, when the fair market value was $9,400.
c) On May 24,2020, Bill sold for $21,000 stock inherited from his father. His father died on June 14,2019, when the fair market value of the stock was $9,000. Bill's father paid $7,000 for the stock in 2013.
D) On Aug.11,2020, they sold a personal automobile for $8,000; basis of the automobile was $20,000 and it was purchased in 2017.
e) they had a carryover and other stock transaction as follows:
- LTCL carryover from 2019=($7,000)
-STCG=$2,000
-LTCG=$3,500
Bill salary was $40,000 and Alice had a salary of $28,000. They have no children. They paid state income taxes of $6,200, Sales tax of $400, federal income taxes of $15,000, and property taxes of $1,700. In addition, they contributed $16,000 interest on their home mortgage.
Computer Bill and Alice's Taxable Income for 2020.
please include formulas/notes.
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