In December of 2019, a taxpayer received a $5,000 advanced payment from a customer for goods to be delivered in 2020. For the 2019 tax year, what amount of income must the taxpayer recognize under the cash method? What about under the accrual method?

		Cash: $0; Accrual: $0
		Cash: $5,000; Accrual: $0
		Cash: $0; Accrual: $5,000
		Cash: $5,000; Accrual: $5,000

A sole proprietorship purchased a machine in June of 2019 that cost $700,000. The machine is a 7 year MACRS asset. Assume the taxpayer wants to maximize current year depreciation and thus wants to utilize 100% bonus depreciation where applicable. What is the total amount of depreciation the taxpayer can take for the machine in 2019?

An employee was granted 100 Incentive Stock Options with an exercise price of $10/share. The employee exercised all of the options when the FMV was $15/share. The employee subsequently sold the stock several years after exercising the option for a price of $18/share. What amount and character of income must the employee recognize and when will the employee recognize the income?

		$500 of ordinary income at exercise
		$500 of ordinary income at exercise and $300 of LTCG at sale
		$800 of ordinary income at sale
		$800 of LTCG at sale

A single taxpayer sold a rental condo for $200,000 that had an adjusted basis of $130,000. The condo originally cost $160,000 many years ago. The taxpayer has $320,000 of ordinary income before considering this gain and has no prior unrecaptured 1231 losses. What is the amount of tax on the gain?

		10,500
		13,500
		16,500
		24,500

A single taxpayer had $180,000 of wage income and $40,000 of net passive income during the tax year. Assuming the taxpayer had no other sources of income or deductions for the year, what amount of net investment income tax does the taxpayer owe? Hint: The AGI threshold for the tax is $200,000 for a single taxpayer.

		$0
		$360
		$760
		$1,520