John and Mary were divorced in 2017. The divorce decree (executed 6/30/17) provides that John pay alimony of 10,000 per year, to be reduced by 20 percent on their child's 18th birthday. During the current year, the 10,000 was paid in the following way: John paid 7,000 directly to Mary and $3,000 to Spring College for Mary's tuition. What amount of these payments should be reported as income in Mary's current year income tax return?()
A. $5,600
B. $8,000
C. $8,600
D. $10,000
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An individual taxpayer reports the following items for the current year:Ordinary income from partnership A, operating a movie theater in whichthe taxpayer materially participates 70,000Net loss from partnership B, operating an equipment rental business inwhich the taxpayer does not materially participate (9,000)Rental income from building rented to a third party 7,000Short-term capital gain from sale of stock 4,000What is the taxpayer's adjusted gross income for the year?
A. $70,000
B. $72,000
C. $74,000
D. $77,000
Which of the following statements regarding an individual's suspended passive activity losses is correct?
A. $3,000 of suspended losses can be utilized each year against portfolio income.
B. Suspended losses can be carried forward, but not back, until utilized.
C. Suspended losses must be carried back three years and forward five years.
D. maximum of 50 percent of the suspended losses can be used each year when an election is made to forgo the carryback period.
DAC Foundation awarded Kent 75,000 in recognition of lifelong literary achievement. Kent was not required to render future services as a condition to receive the 75,000. What condition(s) must have been met for the award to be excluded from Kent's gross income?I. Kent was selected for the award by DAC without any action on Kent's part.II. Pursuant to Kent's designation, DAC paid the amount of the award either to a governmental unit or to a charitable organization.()
A. I only.
B. II only.
C. Both I and II.
D. Neither I nor II.
Clark did not itemize deductions on his Year 8 federal income tax return. In July Year 9, Clark received a state income tax refund of 900 plus interest of 10, for overpayment of Year 8 state income tax. What amount of the state tax refund and interest is taxable on Clark's Year 9 federal income tax return?()
A. $0
B. $10
C. $900
D. $910