Questions from Federal Taxation

Q: Wade filed his Federal income tax return on time but did not

Wade filed his Federal income tax return on time but did not remit the balance due. Compute Wade’s failure to pay penalty in each of the following cases. The IRS has not issued a deficiency notice. a....

Q: Compute the failure to pay and failure to file penalties for John

Compute the failure to pay and failure to file penalties for John, who filed his 2017 income tax return on December 20, 2018, paying the $10,000 amount due at that time. On April 1, 2018, John receive...

Q: Olivia, a calendar year taxpayer, does not file her 2017

Olivia, a calendar year taxpayer, does not file her 2017 Form 1040 until December 12, 2018. At this point, she pays the $40,000 balance due on her 2017 tax liability of $70,000. Olivia did not apply f...

Q: Maureen, a calendar year individual taxpayer, files her 2016 return

Maureen, a calendar year individual taxpayer, files her 2016 return on November 4, 2018. She did not obtain an extension for filing her return, and the return reflects additional income tax due of $15...

Q: Blair underpaid her taxes by $250,000. A portion

Blair underpaid her taxes by $250,000. A portion of the underpayment was shown to be attributable to Blair’s negligence ($100,000). A court found that the rest of the deficiency constituted civil frau...

Q: Compute the overvaluation penalty for each of the following independent cases involving

Compute the overvaluation penalty for each of the following independent cases involving the fair market value of charitable contribution property. In each case, assume a marginal income tax rate of 35...

Q: Compute the undervaluation penalty for each of the following independent cases involving

Compute the undervaluation penalty for each of the following independent cases involving the value of a closely held business in the decedent’s gross estate. In each case, assume a m...

Q: Singh, a qualified appraiser of fine art and other collectibles,

Singh, a qualified appraiser of fine art and other collectibles, was advising Colleen when she was determining the amount of the charitable contribution deduction for a gift of a sculpture to a museum...

Q: The Eggers Corporation filed an amended Form 1120, claiming an additional

The Eggers Corporation filed an amended Form 1120, claiming an additional $400,000 deduction for payments to a contractor for a prior tax year. The amended return was based on the entity’s interpretat...

Q: Recently, a politician was interviewed about fiscal policy, and she

Recently, a politician was interviewed about fiscal policy, and she mentioned reducing the “tax gap.” Explain what this term means. What are some of the pertinent political and economic issues relativ...