Teddy has ten shares of stock that he bought on March 1, Year 1, for $5 each. On March 1, Year
2, he sells all the shares for $200. What is the income tax consequence of the sale?
$150 short-term capital gain
Christian filed his individual federal tax return for the year ending December 31, 2020 on April 15, 2021 and he owed $18,000. As of December 15, 2021, he still has not paid any his tax liability. How much does Christian owe as of December 31, 2021?
$18,810 [(18,000 x 0.005) x 9 + 18,000] Christian did not fail to file - he failed to pay. Therefore, he owes the 0.5% per month or part of a month failure to pay penalty plus the outstanding tax amount of $18,000.
Which, if any, of the following statements is (are) correct (assuming no withholdings or estimated
payments)?
1 Refundable tax credits can generate a tax refund.
2 Nonrefundable tax credits can generate a tax refund. 1 only
On June 2, Rhea purchased 100 shares of stock for $10,000. When it was worth $20,000, on December 25 of the same year, she gifted all the stock to her nephew, Sammy. Sammy sold the stock on the following October 15th, for its fair market value of $25,000. What is Sammy's tax consequence?
$15,000 long term capital gain
All the following federal income tax penalties are correct except: there is a 20% penalty per month for fraud up to 100% of under paym
ent (the penalty for fraud is 75% of underpayment).
All of the following are excluded from the gross income of the recipient except:
Alimony ordered by court (divorce prior to 2019)
Bill, who is single, sells his personal residence to move from Atlanta to Chicago due to being transferred by his employer. He has owned and used the house for 18 months. The sale price is $460,000, selling expenses are $25,000 and his adjustable taxable basis is $180,000. What, if any, is Bill's taxable gain?
67,500
Which of the following is not one of the three separate and distinct tax systems that are relevant to financial planning?
Ad valorem tax system
Georgia just died from a terrible bus accident. She was only 34 years old and had two children under six. Under which of the following circumstances would she be considered to have died intestate? All of the aboce
