Abc Cecil cashed in a Series EE savings bond with a redemptionvalue of $22,500 and an original cost of $15,750. For thefollowing scenario, calculate the amount of interest Cecilwill include in his gross income assuming he files as a singletaxpayer:Cecil plans to spend $6,750 of the proceeds to pay histuition at State University and estimates his modifiedadjusted gross income at $65,100.

Step 1: Calculate the Total Interest EarnedThe total interest earned is the difference between the…

Answered: Cecil cashed in a Series EE savings…

SWFT Comprehensive Vol 2020

43rd Edition

ISBN:9780357391723

Author:Maloney

Publisher:Maloney

Chapter6: Deductions And Losses: In General

Section: Chapter Questions

Problem 25DQ

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9:) Cecil cashed in a Series EE savings bond with a redemption value of $16,000 and an original cost of $11,200. For each of the following independent scenarios, calculate the amount of interest Cecil will include in his gross income assuming he files as a single taxpayer: (Leave no answer blank. Enter zero if applicable.) A:) Cecil plans to spend all of the proceeds to pay his son's tuition at State University, Cecil's son is a full- time student, and Cecil claims his son as a dependent. Cecil estimates his modified adjusted gross income at $61,700. Amount of interest to be included in gross income: B:) Assume the same facts in part (a), except Cecil plans to spend $4,800 of the proceeds to pay his son's tuition at State University, and Cecil estimates his modified adjusted gross income at $57,500. Amount of interest to be included in gross income:
Marlene, a cash basis taxpayer, invests in Series EE U.S. government savings bonds and bank certificates of deposit (CDs). Determine the tax consequences of the following on her 2019 gross income: a. On September 30, 2019, she cashed in Series EE bonds for 10,000. She purchased the bonds in 2009 for 7,090. The yield to maturity on the bonds was 3.5%. b. On July 1, 2018, she purchased a CD for 10,000. The CD matures on June 30, 2020, and will pay 10,816, thus yielding a 4% annual return. c. On July 1, 2019, she purchased a CD for 10,000. The maturity date on the CD was June 30, 2020, when Marlene would receive 10,300.
[The following information applies to the questions displayed below.] Javier and Anita Sanchez purchased a home on January 1 of year 1 for $1,000,000 by paying $200,000 down and borrowing the remaining $800,000 with a 6 percent loan secured by the home. The Sanchezes made interest-only payments on the loan in years 1 and 2. (Leave no answer blank. Enter zero if applicable.) b. Assuming year 1 is 2021, how much interest would the Sanchezes deduct in year 2? Maximum deductible interest expense
Jessica purchased a home on January 1, 2021, for $750,000 by making a down payment of $300,000 and financing the remaining $450,000 with a loan, secured by the residence, at 6 percent. During 2021 and 2022, Jessica made interest-only payments on this loan of $27,000 (each year). On July 1, 2021, when her home was worth $750,000, Jessica borrowed an additional $187,500 secured by the home at an interest rate of 8 percent. During 2021, she made interest-only payments on the second loan in the amount of $7,500. During 2022, she made interest-only payments on the second loan in the amount of $15,000. What is the maximum amount of the $42,000 interest expense Jessica paid during 2022 that she may deduct as an itemized deduction if she used the proceeds of the second loan to finish the basement in her home and landscape her yard? (Assume not married filing separately.)
Kari is purchasing a home for $220,000. The down payment is 25% and the balance will be financed with a 15 year mortgage at 8% and 3 discount points. Kari made a deposit of $20,000 (applied to the down payment) when the sales contract was signed. Kari also has these expenses: credit report, $70; appraisal fee, $110; title insurance premium, 1% of amount financed; title search, $200; and attorney's fees, $500. Find the closing costs (in $). $
Matthew purchased his first home in 2021 and the bank required that he pay mortgage insurance premiums of $3,040 which was 1% of his loan of $304,000. Matthew's AGI for 2021 was $106,500. What is Matthew's deduction in 2021 for mortgage insurance premiums? Mortgage insurance premium LA $
Kari is purchasing a home for $260,000. The down payment is 25% and the balance will be financed with a 15 year mortgage at 8% and 3 discount points. Kari made a deposit of $30,000 (applied to the down payment) when the sales contract was signed. Kari also has these expenses: credit report, $70; appraisal fee, $110; title insurance premium, 1% of amount financed; title search, $200; and attorney's fees, $500. Find the closing costs (in $). $ Need Help? Read It Master It Watch It
1. Cameron designates 10% of his monthly earnings as charitable contributions. After deducting this amount, he deposits 5% of the remaining amount into a money market account earning 2%. If Cameron's monthly earnings are $4,800 what amount interest will he earn on his deposit each month? 2. Find the maturity value for a loan on $4,225 at 8% made on March 5 and due on May 5 of the same year. Assume a 365-day year. 3. Republic Bank advertises their interest rates at 7 % %. You decide to apply for a loan in the amount of $9,000 for 90 days. The bank grants your loan and the loan officer tells you that there is a document preparation fee of $150 that needs to be paid at the time you sign the documents for the loan. Find the APR. Assume a 360-day year. 4. You took out a loan of $5,000 on May 2 and went back on June 15 to make a payment of $1,200. The loan was at 4% for 1 year. What was your remaining balance after making that payment?
John Rider wants to accumulate $90,000 to be used for his daughter's college education. He would like to have the amount available on December 31, 2026. Assume that the funds will accumulate in a certificate of deposit paying 8% interest compounded annually. (FV of $1. PV of $1. EVA of $1, PVA of $1. FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Answer each of the following independent questions. Required: 1. If John were to deposit a single amount, how much would he have to invest on December 31, 2021? 2. IH John were to make five equal deposits on each December 31, beginning a year later, on December 31, 2022, what is the required amount of each deposit? 3. If John were to make five equal deposits on each December 31, beginning now, on December 31, 2021, what is the required amount of each deposit? (For all requirements, Round your final answers to nearest whole dollar amount.) 1. Amount Annuity amount Annuity amount 2.
Jessica purchased a home on January 1, 2023, for $570,000 by making a down payment of $230,000 and financing the remaining $340,000 with a loan, secured by the residence, at 6 percent. During 2023 and 2024, Jessica made interest-only payments on this loan of $20,400 (each year). On July 1, 2023, when her home was worth $570,000, Jessica borrowed an additional $142,500 secured by the home at an interest rate of 8 percent. During 2023, she made interest-only payments on the second loan in the amount of $5,700. During 2024, she made interest-only payments on the second loan in the amount of $11,400. What is the maximum amount of the $31,800 interest expense Jessica paid during 2024 that she may deduct as an itemized deduction if she used the proceeds of the second loan to finish the basement in her home and landscape her yard? (Assume not married filing separately.) Multiple Choice $0 $11,400 $29,929 $6,600 $31,800
Jane Doe earns $41,400 per year and has applied for a(n) $89,000, 25-year mortgage at 7 percent interest, paid monthly. Property taxes on the house are expected to be $3,900 per year. If her bank requires a gross debt service ratio of no more than 30 percent, will Jane be able to obtain the mortgage? Is Jane eligible for the loan?
Your sister placed her graduation gifts amounting to P25,000 in a special savings account that provides an interest of 2% for 8 months. Compute the annual interest, total interest, and amount to be received or paid at the end of the term for this scenario using a simple interest assumption and compound interest assumption.

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