Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Paden, who is single and has been employed as an accountant for 27 years with Harper, Inc., lost his job due to company downsizing. His

Paden, who is single and has been employed as an accountant for 27 years with Harper, Inc., lost his job due to company downsizing. His last day of employment is July 31, 2014, and Harper provides a $9,000 severance payment. The severance payments are based on the employee's time of employment. During the year, Paden received a salary of Harper of $36,000. Harper also paid $1,500 of Paden's medical premiums.

In May 2014, Paden, who had always wanted to be associated with a football team, applied for the head coaching job at Hawk University in Iowa and, much to his surprise, received the job beginning on August 1. In June and July, Paden paid $4,500 to take courses in sports management at the local university. Hawk University is substantially short of funding and Paden paid $2,000 for entertainment expenses related to his job and $500 for supplies. No reimbursement was received.

His salary from Hawk is $4,000 per month payable at the end of the month. His salary for December was not received until January 6, 2015.

On August 1, he sold his house for $329,000 in Texas and paid sales commission of $14,000. He inherited the house 20 years ago when his mother died. Her basis for the house was $37,000 and the FMV when she died was $50,000. Property taxes for the 2014 calendar year amount to $3,600, and property taxes were appointed at closing. Property taxes are payable on October 1. He paid $12,000 of interest on home equity debt of $150,000.

To move to Iowa, he drove 700 miles and spent $45 for meals during the trip in July. Movers charged $4,150 to move household items. Use the standard mileage rate for moving expenses for 2014 which is 23.5 cents per mile. He purchased a new house in Iowa for $150,000 on August 15 and borrowed $110,000. He also agreed to pay all property taxes for 2014. Real property taxes for the new home in Iowa will be paid on January 30, 2015 and the amount to $1,500. Interest on the $110,000 debt during the current year is $1,475. To obtain the loan, Paden paid points of $1,000.

He contributed common stock (basis of $1,000 and FMV of $6,000) held as an investment for three years to Hawk University. He also paid state income taxes of $1,765 (which was greater than state sales taxes for the year) as well as personal property taxes of $453 for his car.

Paden sold 200 shares of Dell Corporation stock on April 10 for $100 per share. His basis was $145 per share. On May 1, he purchased 300 shares of Dell at $89 per share.

Determine:

1. Total amount itemized deductions?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Accounting questions

Question

Define and discuss post-purchase dissonance?

Answered: 1 week ago

Question

What is meant by Career Planning and development ?

Answered: 1 week ago

Question

What are Fringe Benefits ? List out some.

Answered: 1 week ago