Questions from Federal Taxation

Q: For 2017, the Wes Trust reports $100,000 of

For 2017, the Wes Trust reports $100,000 of AMT income before the annual exemption. The AMT for the year is: a. $19,734. b. $21,308. c. $26,000. d. $28,000.

Q: For 2017, the Guess Trust retains all of its income items

For 2017, the Guess Trust retains all of its income items, which include only $100,000 of net investment income and $40,000 of profits from an active business operation. Guess incurs an additional tax...

Q: The Biltmore Trust is a simple trust. Crawford is its sole

The Biltmore Trust is a simple trust. Crawford is its sole beneficiary. In the current year, the trust earns $3,200 in taxable interest and $8,000 in tax exempt interest. In addition, the trust recogn...

Q: The Hosta Trust reports gross rent income of $72,000

The Hosta Trust reports gross rent income of $72,000, expenses attributable to the rents of $55,000, and tax-exempt interest from state bonds of $18,000. Under the trust agreement, the trustee is to p...

Q: Compute the Federal income tax liability for the Valerio Trust. The

Compute the Federal income tax liability for the Valerio Trust. The entity reports the following transactions for the 2017 tax year. The trustee accumulates all accounting income for the year. Operat...

Q: The Liu Trust is short of cash. It is required to

The Liu Trust is short of cash. It is required to distribute $100,000 to Yang every year, and that payment is due in six weeks. In its asset corpus, Liu holds a number of investments that are valued a...

Q: Stan Bushart works as a customer representative for a large corporation.

Stan Bushart works as a customer representative for a large corporation. Stan’s job entails traveling to meet with customers, and he uses his personal car 100% for business use. In 2...

Q: Dr. John Brown is a physician who expects to make $

Dr. John Brown is a physician who expects to make $150,000 this year from his medical practice. In addition, Dr. Brown expects to receive $10,000 dividends and interest income. Last year, on the advi...

Q: Sarah loans $50,000 to her best friend, John

Sarah loans $50,000 to her best friend, John. John uses the money to open a pizza parlor next to the local high school. Three years later, when John still owed Sarah $15,000, John closed the pizza par...

Q: Dana is an attorney who specializes in family law. She uses

Dana is an attorney who specializes in family law. She uses the cash method of accounting and is a calendar-year taxpayer. Last year, she represented a client in a lawsuit and billed the client $5,000...