Analyze the tax implications

Assignment Help Accounting Basics
Reference no: EM13657866

Analyze the tax implications of the following case studies. Apply the IRS codes to determine what should and shouldn't be included as income. Support your conclusions with reference to specific IRS codes and regulations.

Case Study Problem 1
John and Amy are your tax clients. They were divorced 2 years ago, and they live in separate households. Their divorce decree stated that John was to make monthly payments to Amy. The court designated $300 per month as alimony and $200 per month as child support, or a total of $6,000 per year. Pursuant to the divorce agreement, alimony payments would terminate at the death of the payee. John has been unemployed for much of the year and paid Amy $2,000 that he said was for child support. In addition, John transferred the title to a three-year-old car with a $4,000 fair market value (FMV) and basis of $7,000 in exchange for her promise not to pursue any claim she has against him for the unpaid child support and alimony. Does Amy have to report any alimony, and is John entitled to an alimony deduction? What are the tax consequences for both John and Amy?

Reference no: EM13657866

Questions Cloud

Asset gains and losses : Asset gains and losses
Detemline the input power required at shaft : Design a gear train which satisfies the above criteria. Use a sketch to illustrate your design, label the gears A, B, C, etc. from the driver to the driven gear, and state the number of teeth on each gear
The views on capitalization of leased assets : What are some of the views on capitalization of leased assets?
Gaap and ifrs address accounting processes : GAAP and IFRS address accounting processes
Analyze the tax implications : Analyze the tax implications of the following case studies. Apply the IRS codes to determine what should and shouldn't be included as income. Support your conclusions with reference to specific IRS codes and regulations.
Costs using activity proportions : Costs Using Activity Proportions
Journalize both issuances : Journalize both issuances
A perpetual inventory system : BE9-3 Kumar Inc. uses a perpetual inventory system. At January 1, 2014, inventory was $214,000 at both cost and market value. At December 31, 2014, the inventory was $286,000 at cost and $265,000 at market value.
What is the maximum speed of the block : A block of mass m = 0.875 kg is fastened to an unstrained horizontal spring whose spring constant is k = 81.3 N/m. The block is given a displacement of +0.134 m, where the + sign indicates that the displacement is along the +x axis, and then released..

Reviews

Write a Review

 

Accounting Basics Questions & Answers

  On june 30 2013 georgia-atlantic inc leased a warehouse

on june 30 2013 georgia-atlantic inc. leased a warehouse facility from ic leasing corporation. the lease agreement

  Would it be possible for calcor company to achieve the

calcor company has been a wholesale distributor of automobile parts for domestic automakers for 20 years. calcor has

  Assume that on july 1 2012 venzuela co retires half of the

venzuela co. is building a new hockey arena at a cost of 2500000. it received a downpayment of 500000 from local

  All sales and purchases are on account it is expected that

krause industriesbalance sheetdecember 31 2013assets current assetscashnbspnbspnbsp 7500?accounts

  Matt and shanekwa ages 45 and 44 respectively file a joint

matt and shanekwa ages 45 and 44 respectively file a joint tax return for 2011. they provided all of the support for

  For this discussion assume your company has hired research

for this discussion assume your company has hired research in motion to install and service a server to link all

  As the company is preparing its schedule of cash

mimosa company is putting together its budget for the first half of the coming year. based on its history the company

  What is the year-end balance of the equity investment

During the year, Best Pictures reports net income of $350,000 and pays $90,000 of cash dividends. At the end of the year, the market value of Berlin's investment is $3.7 million. What is the year-end balance of the equity investment in Best Pictur..

  Use information from problem vi to prepare journal entries

use information from problem vi to prepare journal entries for the following events for the month of may. remember that

  Approximation of a normal distribution

A new extended-life light bulb has an average service life of 743 hours, with a standard deviation of 49 hours. If the service life of these light bulbs approximates a normal distribution, about what percent of the distribution will be between 645..

  During the year summit produces 50000 snow shovels and

summit manufacturing inc. produces snow shovels. the selling price per snow shovel is 30. there is no beginning

  Prepare the journal entries for the current month do not

the following events occurred during the first month of operations for xyz ltd. a company specialised in providing

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd