During the year, Morton reports $80,000 of active business income from his law practice. He also owns two passive activities. From Activity A, he incurs $30,000 of loss, and from Activity B, he earns $20,000 income. As a result, Morton Select one: a. reports AGI of $80,000. b. reports AGI of $100,000 with a $30,000 passive loss carryover. c. reports AGI of $80,000 with a $10,000 passive loss carryover. d. reports AGI of $80,000 with a $30,000 passive loss carryover. On April 15, Richard (age 57) was fired from his employer of 25 years due to poor performance.. During his 25 years of employment, Richard contributed $200,000 to his traditional 401(k) account. When Richard was fired, his 401(k) account balance was $700,000 (this included both employer matching and account earnings). Richard immediately withdrew $50,000 to use for expenses.. What amount of tax and 10% early distribution penalty must Richard pay on the $50,000 withdrawal if his ordinary marginal tax rate is 32 percent? Answer: Henry rents his second home. During the year, Henry reported a net loss of $40,000 from the rental. If Henry is an active participant in the rental and his AGI is $110,000, how much of the loss can he deduct against ordinary income for the year? Select one: O a. $0. O b. $20,000 c. $25,000 d. $40,000 Joel has four transactions involving the sale of capital assets during the year resulting in a STCG of $5,000, a STCL of $3,000, a LTCG of $3000 and a LTCL of $9000. As a result of these transactions, Joel will Select one: a. deduct losses of $3,000 against ordinary income and carry $1,000 of LTCL forward. b. deduct losses of $3,000 against ordinary income and carry $1,000 of losses back two years and forward 5 years c. deduct net losses of $4,000 against ordinary income. d. deduct losses of $3,000 against ordinary income and carry $1,000 of STCL forward. Bill owns a second home that he rents to others. During the year, he used the second home for 40 days for personal use and for 120 days for rental use. Bill collected $25,000 of rental receipts during the year. Bill allocated $8,000 of interest expense and property taxes, $12,000 of other expenses, and $8,000 of depreciation expense to the rental use. What is Bill's net income from the property and what type and amount of expenses will he carry forward to next year, if any? Select one: a. $3,000 of interest expense and property taxes carried forward to next year. $0 net income. b. $0 expenses carried over to next year. ($3,000) net loss. O c. $3,000 of other expense carried over to next year. $0 net income. d. $3,000 depreciation expense carried forward to next year. $0 net income. Which one of the following is classified as both personal property and personal-use property? Select one: a. Shiela owned a computer that she used to prepare her own tax returns. b. Thomas owned a computer which he used only to trade stocks and bonds and manage his investments. c. Shiela used a car only as a driver for Uber. d. Shiela owned a storage building used by her to store her personal records. e. Wamco Company used a computer that was only used to email Wamco employees regarding company business