During 2022, Rick and his wife, Sara, had the following items of income and expense to report:

a. Assuming that Rick and Sara file a joint return, what is their taxable income for 2022?

b. What is the amount of Rick and Sara’s NOL for 2022?

c. To what years can Rick and Sara’s NOL be carried?

d. Based on your computations, identify the components of their NOL. What is the rationale for excluding the items that do not affect the NOL computation?

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Gross receipts from business Business expenses Interest income from bank savings accounts Sara's salary Long-term capital gain on stock held as an investment Itemized deductions $400,000 525,000 8,000 50,000 4,000 15,000