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TRUEFALSE. Write T if the statement is true and F if the statement is false. 1) The total worthlessness of a security results in an

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TRUEFALSE. Write T if the statement is true and F if the statement is false. 1) The total worthlessness of a security results in an ordinary loss. 2) Material participation by a taxpayer in a passive activity is satisfied if the individual participates in the activity for more than 500 hours during the year 2) 3) A taxpayer may deduct a loss resulting from the theft of business and investment property but not a theft of personal-use property 3) 4) bad debt gives rise to an ordinary deduction while a nonbusiness bad debt is treated as 4) A business a short-term capital loss. ICE. Choose the one alternative that best completes the statement or answers the question. 5) MULTIPLE CHO 5) Which of the following is most likely not considered a casualty? A) death of a pine tree due to a two-day infestation of pine beetles B) fire loss C) water damage to the walls and ceiling of a taxpayer's personal residence as the result of gradual deterioration of the roof D) water damage caused by a busted water heater 6) In 2014 Grace loaned her friend Paula $12,000 to invest in various stocks. Paula signed a note to repay the principal with interest. Unfortunately the market for that industry sector plunged, and Paula incurred large losses. In 2017 Paula declared personal bankruptcy and Grace was unable to collect any of her loan. Grace had no other gains or losses last year or this year. The result is A) Grace deducts a $3,000 nonbusiness bad debt as a short-term capital loss in 2017 and carries $9,000 over to subsequent years. B) race deducts a $12,000 nonbusiness bad debt as a short-term capital loss in 2017. C) Grace deducts a business bad debt of $12,000 in 2017. D) Grace deducts a business bad debt of $3,000 in 2017 and carries $9,000 over to subsequent years. TRUE/FALSE. Write T if the statement is true and F' if the statement is false. 7) In order for an asset to be depreciated in the year of purchase, it must be placed in service before year's end 7) 8) The Section 179 expensing election is available on an annual basis for property purchased during the year 8) A-1

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