ACCT 553 Week 3 Homework ES

“Recognition of an impairment loss and the recognition of a gain on the extinguishment of debt are separate events, and each event should be recognized in the period in which it occurs. The Board believes that the recognition of an impairment loss should be based on the measurement of the asset at its fair value and that the existence of nonrecourse debt should not influence that measurement.” (Statement 144, paragraph B34)

These are the automatically computed results of your exam. Grades for essay questions, and comments from your instructor, are in the "Details" section below.

1. For the year-end December 31, 2007, financial statements, what amount should M record as a liability?

§ 36(c) of the Internal Revenue Code. At the same time, the Tax Court does not execute the law based on its plain language.

| 19 |LO 4 |Dependency exemption: exceptions to the citizenship or | |New | |

Tiebreaker rules: If a child is claimed as a qualifying child by two or more taxpayers in a given year, the child will be the qualifying child of:

Thank you for stopping by my office on Monday to discuss the relevant inquiries you and your wife Jane have while planning your 2011 tax return. I am only responding to the issues we discussed. I am confident that I can provide the best guidance to minimize your tax liability for I have been in practice for 5 yrs. As you know, there will be a billing for this consultation, but no tax return will be prepared unless an agreement is met.

In general, according to IRS, there are no tax deductions that might ease the pain of divorce. However, even though it has no sympathy for the legal fees incurred by a couple who split, a husband and wife might be able to salvage a deduction for the portion of expenses in some circumstances such as tax advice in connection with a divorce, as well as legal fees to obtain taxable alimony. This research paper is going to explore these questions more deeply by examining the provided situation of Bill and Hillary.

31. Rank the following three single taxpayers in order of the magnitude of taxable income (from lowest to highest) and explain your results. Ahmed Gross Income Deductions For AGI Itemized Deductions $ 80,000 8,000 0 Baker $ 80,000 4,000 4,000 Chin $ 80,000 0 8,000

Under the abandoned spouse rule an individual may file as head of household if he/she is separated, but still married if on the last day of the year (which is December 31st) he/she satisfies the requirements of an abandoned spouse-head of household required by the IRS.

A distribution from a traditional IRA may be excluded from gross income if the recipient rolls over the distribution to another traditional IRA or returns it to the same IRA (Code Sec. 408(d)(3); Rev. Proc. 2003-16).

If you are filing exempt for tax purposes, you will need to indicate as such on the

17. Assumption of all debt by a corporation is included under the non-recognition provision of &351. Answer: True

The current U.S. earnings stripping rule limits the deductibility of “disqualified interest expense”. Interest expense paid with respect to a debt owed to or guaranteed by related parties is treated as “disqualified interest expense” if such interest is not subject to U.S. withholding tax

This research project aims at determining IRS position with respect to a petitioner's income tax returns and its relation to the annuity contract. An annuity is made through an insurance company and designed to last the entire lifetime of an individual. The amount payable to the beneficiaries is intended to convert the specific sum of money in terms of periodic payments. The payments are guaranteed for the lifetime or longer of the individual. Relying on the background of the context, IRS has specifically outlined the provisions for periodic payment and taxable portions of the annuity contract. Under this context, gross income is exclusive of any amount receivable as annuities under the annuity contract. The regular payment depends