The single people in this problem share one important skill: they inherit well and did so several years ago. Bea Kwest has $300,000 per year in interest income. She also receives and annual salary of $160,000 Doan Knee has dividend income of $300,000. He is a lawyer and earns $500,000 of fees from his clients and had $340,000 in expenses (which includes $20,000 of wages paid to an employee). His business is treated as a sole proprietorship. His revenue and expenses from his business have been fairly consistent over the last 5 years. Lega Tse earns $500,000 of self-employment income from her proprietorship. She has a long-term capital gain of $120,000 from the sale of stock. She also sold some land used in business for a $120,000 gain. It has been held more than 12 months. She also has $60,000 of dividend income. They have itemized deductions. They have home mortgage interest of $7,000 and state and local property taxes of $3,000. All dividends are qualified 1. Bea and Doan each borrow $30,000 to buy a car for use in their earned income capacities. They pay $3,000 of interest on such loans. Tax changes? (Ignore depreciation/expense issues regarding the actual purchase of the cars) 2. Each of the three will borrow $4 million to invest in some raw land that hopefully will go up in value. Each will pay $200,000 of interest on such borrowing during the year. Advise them carefully. Assume they are still single. 3. What if Doan's business is selling T-Shirts instead of being a lawyer? What if Doan is still in the lawyer business but only had $50,000 in dividends, everything else is the same? 4