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You are working with a client, Donna, who has come to you letting you know she has no income t problems for the year, but she wants to run her situations by you, just in case there might be som unexpected tax liability. In the current year, she has the following information to share with you: 1. Donna's share of the SAT partnership income is $150,000, but none of the income can be distributed because the partnership needs the cash for operations. 2. Donna's social security benefits totaled $10,500, but she loaned the cash received to her nephew. 3. Donna assigned to a creditor the right to collect $1,500 of interest on some bonds she own 4. Donna and her husband lived together in California until September, when they separated Donna has heard through the grapevine that her husband has substantial gambling winnin since they separated. 5. Donna found $50,000 in an airport bar, no one came to claim it while she was waiting for h flight, so she kept the envelope.

You are working with a client, Donna, who has come to you letting you know she has no income t problems for the year, but she wants to run her situations by you, just in case there might be som unexpected tax liability. In the current year, she has the following information to share with you: 1. Donna's share of the SAT partnership income is $150,000, but none of the income can be distributed because the partnership needs the cash for operations. 2. Donna's social security benefits totaled $10,500, but she loaned the cash received to her nephew. 3. Donna assigned to a creditor the right to collect $1,500 of interest on some bonds she own 4. Donna and her husband lived together in California until September, when they separated Donna has heard through the grapevine that her husband has substantial gambling winnin since they separated. 5. Donna found $50,000 in an airport bar, no one came to claim it while she was waiting for h flight, so she kept the envelope.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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You are working with a client, Donna, who has come to you letting you know she has no income tax problems for the year, but she wants to run her situations by you, just in case there might be some unexpected tax liability. In the current year, she has the following information to share with you: 1. Donna's share of the SAT partnership income is $150,000, but none of the income can be distributed because the partnership needs the cash for operations. 2. Donna's social security benefits totaled $10,500, but she loaned the cash received to her nephew. 3. Donna assigned to a creditor the right to collect $1,500 of interest on some bonds she owned. 4. Donna and her husband lived together in California until September, when they separated. Donna has heard through the grapevine that her husband has substantial gambling winnings since they separated. 5. Donna found $50,000 in an airport bar, no one came to claim it while she was waiting for her flight, so she kept the envelope. Please draft an e-mail to Donna addressing the tax consequences of each of the five scenarios above.
Transcribed Image Text:You are working with a client, Donna, who has come to you letting you know she has no income tax problems for the year, but she wants to run her situations by you, just in case there might be some unexpected tax liability. In the current year, she has the following information to share with you: 1. Donna's share of the SAT partnership income is $150,000, but none of the income can be distributed because the partnership needs the cash for operations. 2. Donna's social security benefits totaled $10,500, but she loaned the cash received to her nephew. 3. Donna assigned to a creditor the right to collect $1,500 of interest on some bonds she owned. 4. Donna and her husband lived together in California until September, when they separated. Donna has heard through the grapevine that her husband has substantial gambling winnings since they separated. 5. Donna found $50,000 in an airport bar, no one came to claim it while she was waiting for her flight, so she kept the envelope. Please draft an e-mail to Donna addressing the tax consequences of each of the five scenarios above.
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