Question
For the current football season, Gordon Corporation pays $50,000 for a skybox (containing 15 seats) at Veterans Stadium for eight home games. Regular non-skybox seats
- For the current football season, Gordon Corporation pays $50,000 for a skybox (containing 15 seats) at Veterans Stadium for eight home games. Regular non-skybox seats at each game range from $120 to $150 a seat. In November, a Gordon employee and ten clients use the skybox to attend a game. The event is preceded by a bona fide business discussion, and Gordon spent $1,000 for food and drinks during the game. What is Gordons deduction?
- Meg and Kip are staff accountants at a major public accounting firm. Both are pursuing a law degree in a night program at local law school. Meg contends that the cost of the program is a deduction for income tax purposes, while Kip maintains that it is not. Who is correct and why?
- If a firm retains James to provide services, then, James may either be an employee or be self-employed (i.e., independent contractor).
- What are the tax advantages to the business of having the service provider classified as self-employed?
- What are the advantages and disadvantages to the service provider of self-employed status
- For calendar year 2017, Thurston and Eunice Howell (ages 59 and 60) file a joint return reflecting AGI of $280,000. They incur the following expenditures:
Medical expenses before 10%-of-AGI floor | $30,000 |
Casualty loss (not covered by insurance) before statutory floors | 30,000 |
Interest on home mortgage | 10,000 |
Interest on credit cards | 800 |
Property taxes on home | 13,000 |
Charitable contributions | 17,000 |
State income tax | 15,000 |
Tax return preparation fees | 1,200 |
What is the amount of itemized deductions the Thurstons may claim?
- Carol sold her personal residence to Mike for $300,000. Before the sale, Carol paid the real estate taxes of $8,000 for the calendar year. For income tax purposes, the deduction is apportioned as follows: $5,000 to Carol and $3,000 to Mike.
a. What is Mikes basis in the residence? b. What is Carols amount realized from the sale of the residence? c. What amount of real estate taxes can Mike deduct?
d. What amount of real estate taxes can Carol deduct?
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