The amount of interest income a taxpayer recognizes when he redeems a U.S. savings bond is:

the excess of the bond proceeds over the taxpayer's basis in the bonds

Scarlett made her annual gambling trip to Tara Casino. On this trip she won $250 at the slot machines and $950 at Black Jack Also this year, she made several trips to the dog tracks, but lost $900 on her various wagers. What amount must she include in her gross income?

Walter files a single tax return and has adjusted gross income of $304,000. His net investment income is $60,000. What is the additional tax that he will pay on his net investment income for the year?

Frank is a carpenter who uses the cash method of accounting. This year he requested that his clients make their checks payable to his daughter, Stella. This year Stella received checks in the amount of $50,000 for Frank's carpentry services. Which of the following is a true statement?

A. Frank is taxed on $50,000 of carpentry income this year. B. Stella is taxed on $50,000 of carpentry income this year. C. Sella is taxed on $50,000 of income from gifts received this year. D. Frank may deduct the $50,000 received by Stella. E. None of the choices are correct.

The maximum amount of net capital losses individual taxpayers may deduct against their ordinary income per year is:

What is the correct order of the loss limitation rules?

A. tax basis, at-risk amount, passive loss limits

Identify the rule that determines whether a taxpayer must include in income a refund of an amount deducted in a previous year:

When selling stocks, which method of calculating basis provides the greatest opportunity for minimizing gains or increasing losses?

A. LIFO

B. FIFO

C. Weighted average

D.Specific identification

E. None of these.

Campbell, a single taxpayer, has $95,000 of profits from her general store that she operates as a sole proprietorship. She has no employees, $40,000 of qualified property, and $50,000 of taxable income before the deduction for qualified business income. How much is Campbell's deduction for qualified business income?

Andrew bought 200 shares of Intel stock on January 1, 2018 for $50 per share with a brokerage fee of $100. Then, he sells all 200 shares for $75 per share on December 12, 2018. The brokerage fee on the sale was $150. What is the amount of the his gain/loss that must be reported on his 2018 tax return?

This year Nick paid $3,500 of interest on a loan that paid his undergraduate tuition. How much of this payment can he deduct as interest expense on an educational loan if he files single and reports modified AGI of $85,000?

Which of the following is a true statement?

A. A casualty loss on personal-use assets is generally not deductible.

B. A casualty loss on investment property is generally not deductible.

C. All casualty losses are deductible.

D. A casualty loss on personal-use asset is deductible for AGI.

E. None of the choices are correct.

A casualty loss on personal-use asset is deductible for AGI.

True or False?

Dan files a single tax return and decides to itemize his deductions. His income for the year consists of $85,000 of salary, $5,000 long-term capital gain, and $2,500 interest income. Dans expenses for the year consists of $500 investment advice fees and $200 subscription to the Wall Street Journal. What is his investment expense deduction?

Mary paid $15,000 of interest on her $300,000 acquisition debt for her home (fair market value of $500,000), $4,000 of interest on her $30,000 home-equity loan, $1,000 of credit card interest, and $3,000 of interest expense on her margin account for the purchase of stock. Assume that Mary has $10,000 of interest income this year and no investment expenses. How much of the interest expense may she deduct this year?

This year Charles purchased 500 shares of Lee Industries common stock for $20 per share. At year-end the shares were only worth $2 per share. What amount can he deduct as a loss this year?

A. $10,000

B. $9,000

C. $1,000

D. He can deduct $10,000 only if he includes $1,000 in his taxable income

E. $0

Ivan is a self-employed plumber and his wife, Donna, works full-time as a grade school teacher. Ivan paid $525 for tools and supplies, and Donna paid $5,000 on an after-tax basis as her share of health insurance premiums for Ivan and herself in a qualified plan provided by the school district. Which of the following is a true statement?

A. Both expenditures are deductible for AGI.

B. The tools and supplies are an itemized deduction but the health insurance is deductible for AGI.

C. Neither of the expenditures is deductible.

D. The tools and supplies are deductible for AGI while the health insurance is an itemized deduction.

E. Both expenditures are itemized deductions.

Sheldon donated stock (capital gain property) to a public charity. He purchased the stock 3 years ago for $100,000, and on the date of the gift, it had a fair market value of $250,000. What is his maximum charitable contribution deduction for the year related to this stock if his AGI is $600,000?

Colleen bought 1,000 shares of GE Corporation stock for $5,000 on January 15, 2016. On December 31, 2018 she sold all 1,000 shares of her GE stock for $4,500. Based on a hot tip from her friend, she bought 1,000 shares of GE stock on January 20, 2019 for $3,000. What is Colleens recognized loss on her 2018 sale and what is her basis in her 1,000 shares purchased in 2019?