Question 2 Amelia, a cash method taxpayer, knows that you are currently taking the Tax class and asks for your help Below are Amelia items of income in 2020 that she emailed you Salary from being an employee at HEB $60k Alimony payment received from ex husband $12k Money received from selling artworks on Etsy $5k Other than those items above, Amelia also told you about a few other things happened in 2020 Although Amelia do not include these items in the email, as a tax student, you are aware that they might be taxable, but you are not sure yet She won a Gucci handbag when being the 1,000th customer to enter the store on July 4th, 2020 when window shopping The bag is sold in store for $2k By being a dedicated employee, Amelia received an employee of the year award of $300 HEB gift card from her company (HEB) HEB gave Amelia a $200 downtown parking prepaid card each month because part of her job requires commuting between the HEB headquarter to downtown San Antonio In total, Amelia had received $2,400 in prepaid parking card in 2020 What amount is included in Amys gross income in 2020 Show calculations and explanations Question 3 Abdu have the following items in 2020 His AGI before any items below is $40k Abdu partially own a bar in downtown Austin, TX Most work is done by the manager (his friend) and Abdu only job is to collect money from the store each month The Austin bar bring Abdu $15k income Abdu is a partner in AbduHippity LLC and has the tax basis of $70k Amazon LLC has a loss and Abdu's share of the loss is $60k Abdu do not actively work for AbduHippity LLC Abdu invest in stock and has a $3k short term capital gain and $1k dividend income Abdu has a summer home which he rent out for the full year of 2020 The rental house results in a $5k loss Abdu actively work as a managing partner at AbduHop LLC, with his share of income is $12k How much loss from his businesses rental can Abdu deduct in 2020 How much of the loss is carried forward Show calculations and explanations Question 4 Austin, your high school friend, has the following expenses in 2020 Austin is not sure how to treat them for his tax purpose in 2020 so he asked for your help Due to COVID 19, Austin has to work from home Austin spent $10k out of pocket on the following which his employer reimburses nothing o Standingdesk$1k o Computersystem $8k o Microphoneandwebcamsystemforconferencecall $1k Austin has a 2nd home in Galveston where he rent out on Airbnb for the whole year of 2020 Austin planned to visit this home and stay there for a week in July 2020, but due to the COVID 19, he did not Below are the items associated with the home o Totalincome(beforeanyexpenses) $20k o Totalexpenses $30k Austin had to relocate back to his hometown from his workplace city because of COVID 19 The total expenses related to moving back to his hometown is $1k Austin contribute to both traditional IRA and Roth IRA in 2020 Austin contributed $3k into his traditional IRA and another $3k to his Roth IRA a) Calculate total deduction from the items above Point out what type of deduction they are and provide detail calculations and explanations b) Is there any loss that Austin can claim in 2020 Is there any loss that need to be carried forward Question 5 Short answers, a, b, and c are unrelated a) Fill in the table below and answer the following question Stock Stock A Stock B Stock C Stock D Date Bought 12 22 2018 1 11 2011 2 2 2020 9 5 2020 Basis $ 5,000 $ 1,000 $ 3,000 $ 10,000 Date Sold 1 22 2020 1 11 2020 5 10 2020 10 5 2020 Proceed $ 1,000 $ 3,000 $ 10,000 $ 8,000 Amount realized LT ST What is the net capital gain loss and is it LT (long term) or ST (short term) If no netting needed, write No netting needed, the total LT is , the total ST is b) If I am a restaurant owner, what might be some deductions that are directly related to business activities List at least 5 items c) Describe the individual who is very likely to have the following additional tax liabilities tax benefits scenario below a Alternative Minimum Tax (AMT) b Earned income tax credit c Deduction for Qualified Business Income (DQBI)

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Question 2  Amelia, a cash method taxpayer, knows that you are currently taking the Tax class and asks for your help  Below are Amelia items of income in 2020 that she emailed you  Salary from being an employee at HEB  $60k Alimony payment received from ex husband  $12k  Money received from selling artworks on Etsy  $5k Other than those items above, Amelia also told you about a few other things happened in 2020  Although Amelia do not include these items in the email, as a tax student, you are aware that they might be taxable, but you are not sure yet  She won a Gucci handbag when being the 1,000th customer to enter the store on July 4th, 2020 when window shopping  The bag is sold in store for $2k By being a dedicated employee, Amelia received an employee of the year award of $300 HEB gift card from her company (HEB) HEB gave Amelia a $200 downtown parking prepaid card each month because part of her job requires commuting between the HEB headquarter to downtown San Antonio  In total, Amelia had received $2,400 in prepaid parking card in 2020  What amount is included in Amys gross income in 2020  Show calculations and explanations  Question 3  Abdu have the following items in 2020  His AGI before any items below is $40k  Abdu partially own a bar in downtown Austin, TX  Most work is done by the manager (his friend) and Abdu only job is to collect money from the store each month  The Austin bar bring Abdu $15k income  Abdu is a partner in AbduHippity LLC and has the tax basis of $70k  Amazon LLC has a loss and Abdu's share of the loss is $60k  Abdu do not actively work for AbduHippity LLC  Abdu invest in stock and has a $3k short term capital gain and $1k dividend income Abdu has a summer home which he rent out for the full year of 2020  The rental house results in a $5k loss Abdu actively work as a managing partner at AbduHop LLC, with his share of income is $12k How much loss from his businesses rental can Abdu deduct in 2020  How much of the loss is carried forward  Show calculations and explanations  Question 4  Austin, your high school friend, has the following expenses in 2020  Austin is not sure how to treat them for his tax purpose in 2020 so he asked for your help  Due to COVID 19, Austin has to work from home  Austin spent $10k out of pocket on the following which his employer reimburses nothing  o Standingdesk$1k o Computersystem $8k o Microphoneandwebcamsystemforconferencecall $1k Austin has a 2nd home in Galveston where he rent out on Airbnb for the whole year of 2020  Austin planned to visit this home and stay there for a week in July 2020, but due to the COVID  19, he did not  Below are the items associated with the home  o Totalincome(beforeanyexpenses) $20k o Totalexpenses $30k Austin had to relocate back to his hometown from his workplace city because of COVID 19  The total expenses related to moving back to his hometown is $1k  Austin contribute to both traditional IRA and Roth IRA in 2020  Austin contributed $3k into his traditional IRA and another $3k to his Roth IRA  a) Calculate total deduction from the items above  Point out what type of deduction they are and provide detail calculations and explanations  b) Is there any loss that Austin can claim in 2020  Is there any loss that need to be carried forward  Question 5  Short answers, a, b, and c are unrelated  a) Fill in the table below and answer the following question Stock Stock A Stock B Stock C Stock D Date Bought 12 22 2018 1 11 2011 2 2 2020 9 5 2020 Basis $ 5,000 $ 1,000 $ 3,000 $ 10,000 Date Sold 1 22 2020 1 11 2020 5 10 2020 10 5 2020 Proceed $ 1,000 $ 3,000 $ 10,000 $ 8,000 Amount realized LT ST What is the net capital gain loss and is it LT (long  term) or ST (short term)  If no netting needed, write No netting needed, the total LT is   , the total ST is     b) If I am a restaurant owner, what might be some deductions that are directly related to business activities  List at least 5 items  c) Describe the individual who is very likely to have the following additional tax liabilities  tax benefits scenario below  a  Alternative Minimum Tax (AMT) b  Earned income tax credit c  Deduction for Qualified Business Income (DQBI)

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Question 2: Amelia, a cash method taxpayer, knows that you are currently taking the Tax class and asks for your help. Below are Amelia items

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