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Michelle and Mark are married and file a joint return. Michelle owns and unincorporated dental practice. Mark works part-time as a high school math teacher,
Michelle and Mark are married and file a joint return. Michelle owns and unincorporated dental practice. Mark works part-time as a high school math teacher, and spends the remainder of his time caring for their daughter. During the current year, they report the following items:
Item | Amount | |||||
Mark's salary | $ 18,000 | |||||
Interest earned on savings account | 1,200 | |||||
Interest paid on personal residence | 7,100 | |||||
Itemized deductions for state and local taxes | 3,400 | |||||
Items related to Michelle's dental practice | ||||||
Revenues | 65,000 | |||||
Payroll and salary expense | 49,000 | |||||
Supplies | 17,000 | |||||
Rent | 16,400 | |||||
Advertising | 4,600 | |||||
Depreciation | 8,100 | |||||
Required: | ||||||
a. What is Michelle and Mark's taxable income or loss for the year? b. What is Michelle and Mark's NOL for the year? |
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