Individual Income Taxes
43rd Edition
ISBN: 9780357109731
Author: Hoffman
Publisher: CENGAGE LEARNING - CONSIGNMENT
expand_more
expand_more
format_list_bulleted
Question
thumb_up100%
Chapter 13, Problem 4CPA
To determine
Identify the correct option related to penalty for underpayment of taxes.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Chapter 13 Solutions
Individual Income Taxes
Ch. 13 - Prob. 1DQCh. 13 - LO.2 Clint, a sell-employed engineering...Ch. 13 - Prob. 3DQCh. 13 - Prob. 4DQCh. 13 - Prob. 5DQCh. 13 - LO.4 Mark and Lisa are approaching an exciting...Ch. 13 - Prob. 7DQCh. 13 - Prob. 8DQCh. 13 - Prob. 9DQCh. 13 - Describe the two additional Medicare taxes that...
Ch. 13 - Prob. 11CECh. 13 - Prob. 12CECh. 13 - LO.3 During 2019, Lincoln Company hires seven...Ch. 13 - Prob. 14CECh. 13 - Samuel and Annamaria are married, file a joint...Ch. 13 - Prob. 16CECh. 13 - Prob. 17CECh. 13 - LO.4, 8 Ava and her husband, Leo, file a joint...Ch. 13 - Prob. 19CECh. 13 - Prob. 20CECh. 13 - LO.5 In 2019, Bianca earned a salary of 164,000...Ch. 13 - Prob. 22CECh. 13 - LO.7 Determine the additional Medicare taxes for...Ch. 13 - Prob. 24PCh. 13 - LO.2 Oak Corporation has the following general...Ch. 13 - Prob. 26PCh. 13 - Prob. 27PCh. 13 - Prob. 28PCh. 13 - Prob. 29PCh. 13 - Prob. 30PCh. 13 - LO.4 Jason, a single parent, lives in an apartment...Ch. 13 - LO.4, 8 Joyce, a widow, lives in an apartment with...Ch. 13 - Prob. 33PCh. 13 - Prob. 34PCh. 13 - Prob. 35PCh. 13 - Prob. 36PCh. 13 - Prob. 37PCh. 13 - Prob. 38PCh. 13 - LO.5 During 2019, Greg Cruz (1401 Orangedale Road,...Ch. 13 - Prob. 40PCh. 13 - Jane, who is expecting to finish college in May...Ch. 13 - Julie, being self-employed, is required to make...Ch. 13 - Prob. 43PCh. 13 - Beth R. Jordan lives at 2322 Skyview Road, Mesa,...Ch. 13 - Prob. 45CPCh. 13 - Ashby and Curtis, married professionals, have a...Ch. 13 - Prob. 2RPCh. 13 - Prob. 4RPCh. 13 - Prob. 1CPACh. 13 - Prob. 2CPACh. 13 - Prob. 3CPACh. 13 - Prob. 4CPACh. 13 - Prob. 5CPA
Knowledge Booster
Similar questions
- Which of the following would preclude a taxpayer from deducting student loan interest expense? a. The total amount paid is 1,000. b. The taxpayer is single with AGI of 55,000. c. The taxpayer is married filing jointly with AGI of 120,000. d. The taxpayer is taken as a dependent of another taxpayer.arrow_forwardLast year Aleshia identified 15,000 as a nonbusiness bad debt. In that tax year, before considering the tax implications of the nonbusiness bad debt, Aleshia had 100,000 of taxable income, of which 12,000 consisted of short-term capital gains. This year Aleshia collected 8,000 of the amount she had previously identified as a bad debt. Determine Aleshias tax treatment of the 8,000 received in the current tax year.arrow_forwardTroy, a cash basis taxpayer, is employed by Eagle Corporation, also a cash basis taxpayer. Tray is a full-time employee of the corporation and receives a salary of 60,000 per year. He also receives a bonus equal to 10% of all collections from diems he serviced during the year. Determine the tax consequences of the following events to the corporation and to Troy: a. On December 31, 2019, Troy was visiting a customer. The customer gave Troy a 10,000 check payable to the corporation for appraisal services Troy performed during 2019. Troy did not deliver the check to the corporation until January 2020. b. The facts are the same as in part (a), except that the corporation is an accrual basis taxpayer and Troy deposited the check on December 31, but the bank did not add the deposit to the corporations account until January 2020. c. The facts are the same as in part (a), except that the customer told Troy to hold the check until January 2020 when the customer could make a bank deposit that would cover the check.arrow_forward
- B Corporation, a calendar year-end, accrual basis taxpayer, is owned 75 percent by Bonnie, a cash basis taxpayer. On December 31,2019, the corporation accrues interest of $4,000 on a loan from Bonnie and also accrues a $15,000 bonus to Bonnie. The bonus is paid to Bonnie on February 1,2020; the interest is not paid until 2021 . How much can B Corporation deduct on its 2019 tax return for these two expenses? $0 $4,000 $15,000 $19,000 $12,000arrow_forwardSheila, a single taxpayer, is a retired computer executive with a taxable income of 100,000 in the current year. She receives 30,000 per year in tax-exempt municipal bond interest. Adam and Tanya are married and have no children. Adam and Tanyas 100,000 taxable income is comprised solely of wages they earn from their jobs. Calculate and compare the amount of tax Sheila pays with Adam and Tanyas tax. How well does the ability-to-pay concept work in this situation?arrow_forwardDetermine whether the taxpayer has income that is subject to taxation in each of the following situations: a. Capital Motor Company is going out of business. As a result, June is able to purchase a car for 12,000; its original sticker price was 25,000. b. Chuck is the sole owner of Ransom, Inc., a corporation. He purchases a machine from Ransom for 10,000. Ransom had paid 50,000 for the machine, which was worth 30,000 at the time of the sale to Chuck. c. Gerry is an elementary school teacher. She receives the Teacher of the Month Award for February. As part of the award, she gets to drive a new car supplied by a local dealer for a month. The rental value of the car is 400 per month. d. Payne has worked for Stewart Company for the last 25 years. On the 25th anniversary of his employment with Stewart, he receives a set of golf clubs worth 1,200 as a reward for his years of loyal service to the company. e. Anna enters a sweepstakes contest that was advertised on the back of a cereal box, and wins 30,000. The prize will be paid out in 30 annual installments of 1,000. She receives her first check this year. f. Terry buys an antique vase at an estate auction for 780. Upon returning home, she accidentally drops the vase and finds that a 100 bill had been taped inside it.arrow_forward
- Lisa records nonrefundable Federal income tax credits of 65,000 for the year. Her regular income tax liability before credits is 190,000, and her TMT is 150,000. a. What is Lisas AMT? b. What is Lisas regular income tax liability after credits?arrow_forwardHow do the all events and economic performance requirements apply to the following transactions by an accrual basis taxpayer? a. The company guarantees its products for six months. At the end of 2019, customers had made valid claims for 600,000 that were not paid until 2020. Also, the company estimates that another 400,000 in claims from 2019 sales will be filed and paid in 2020. b. The accrual basis taxpayer reported 200,000 in corporate taxable income for 2019. The state income tax rate was 6%. The corporation paid 7,000 in estimated state income taxes in 2019 and paid 2,000 on 2018 state income taxes when it filed its 2018 state income tax return in March 2019. The company filed its 2019 state income tax return in March 2020 and paid the remaining 5,000 of its 2019 state income tax liability. c. An employee was involved in an accident while making a sales call. The company paid the injured victim 15,000 in 2019 and agreed to pay the victim 15,000 a year for the next nine years.arrow_forwardDuring the 2019 tax year, Brian, a single taxpayer, received $ 7,400 in Social Security benefits. His adjusted gross income for the year was $14,500 (not including the Social Security benefits) and he received $ 30,000 in tax-exempt interest income and has no for-AGI deductions, Calculate the amount of the Social Security benefits that Brian must include in his gross income for 2019. SIMPIFIED TAXABLE SOCIAL SECURITY WORKSHEET (FOR MOST PEOPLE) 1. Enter the total amount of Social Security income. 2. Enter one-half of line 1 3. Enter the total of taxable income items on Form 1040 except Social Security income. 4. Enter the amount of tax-exempt interest income. 5. Add lines 2,3, and 4 6. Enter all adjustments for AGl except for student loan interest, the domestic production activities deduction, and the tuition and fees deduction. 7. Subtract line 6 from line 5 . If zero or less, stop here, none of the Social Security benefits are taxable. 8. Enter $ 25,0001 $ 32,000 if married filing jointly; 0 if married filing separately and living with spouse at any time during the year) 9. Subtract line 8 from line 7 . If zero or less, enter -0 - Note: If line 9 is zero or less, stop here; none of your benefits are faxable. Otherwise, go on to line 10 10. Enter $ 9,0001 $12,000 if married filing jointly; 0 if married filing separately and living with spouse at any time during the year) 11. Subtract line 10 from line 9. If zero or less, enter -0 -. 12. Enter the smaller of line 9 or line 10 . 13. Enter one-half of line 12 14. Enter the smaller of line 2 or line 13 . 15. Multiply line 11 by 85 (. 85 ). If line 11 is zero, enter -0 -. 16. Add lines 14 and 15 17. Multiply line 1 by 85(.85) 18. Taxable benefits. Enter the smaller of line 16 or line 17 . 1.____________ 2.____________ 3.____________ 4.____________ 5.____________ 6.____________ 7.____________ 8.____________ 9.____________ 10.____________ 11.____________ 12.____________ 13.____________ 14.____________ 15.____________ 16.____________ 17.____________ 18.____________arrow_forward
arrow_back_ios
arrow_forward_ios
Recommended textbooks for you
Individual Income TaxesAccountingISBN:9780357109731Author:HoffmanPublisher:CENGAGE LEARNING - CONSIGNMENT
Individual Income Taxes
Accounting
ISBN:9780357109731
Author:Hoffman
Publisher:CENGAGE LEARNING - CONSIGNMENT