Complete Name: Unit 3 Student Name: Johnson, Tahj
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1. Case Study 1: Taxes (p. 153)
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2. Given her current situation, list some suggestion on what Shelby should do with a tax refund of $800.
Student Answer: First, I think it’s good that she has a mindset to change her behavior as far as saving for a wardrobe, which alone says that she is maturing. I think she should look into a savings bond considering her future in mind. What if she has kids and fall on hard times, the savings bond would be a really good financial aspect to rely on. EE bonds may be purchased for any amount greater than twenty-five dollars and are sold at half the face value. They can be purchased for set valves ranging from twenty-five to five-thousand dollars (Kapoor, Dlabay, & Hughes, 2014).Shelby also previously calculated that she may need an emergency fund of three to six months of
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With less withholding tax to the government, Shelby will have more take-home pay than usual. Due to Shelby’s current income just enough to pay living expenses, increase in net pay will raise her discretionary income. She can use the extra amount money to pay the debt or save it (Course Hero, 2017). Some other things for Shelby to consider is having an amount from each paycheck deposited in a savings or investment account; always file tax returns on-time; take advantage of all tax credits for which she is qualified; plan purchases with tax implications in mind; search out all possible itemized deductions (Course Hero, 2017). Reference: Course Hero, (2017). Personal Finance. Retrieved from
deducted from her paycheck. To ensure she is prepared for retirement, she also saves $50.00 per month in a
John and Janet Baker are husband and wife and maintain a household of 7, including Janet and John. Calvin and Florence Carter are Janet’s parents, who are retired. During the year, they received $19,000 in nontaxable funds (disability income, interest on municipal bonds and Social Security benefits) from which $8,000 was equally spent between them on clothing, transportation, and recreation. The remaining $11,000 was invested in tax-exempt securities. Janet Baker paid $1,000 for her mother’s dental work and $1,200 premium on her father’s own life insurance policy. Janet’s father,
In order to deduct her moving expenses, she must meet certain conditions outlined in Reg. 1.217-2 (c). Helen meets the first two requirements (relevance to work test and distance test) without any issue. The third requirement has not yet been met yet though. This requirement is a minimum period of employment. Since she is a full-time employee, she must work full-time in this general location for at least 39 weeks during the 12 month period after the move. This does not mean she is not required to remain employed at her current place of work to meet this test. Even though she does not meet this requirement yet, she can deduct these expenses on the current years return or the year the reimbursement is paid to her by her employer. If she recognizes the expenses on this year’s return and does not end up meeting the requirement, she will have to include the deductions she took on this year’s return in next year’s gross income.
Make sure she knows how much money she would actually get the next month. I would also include getting a loan which she could pay off monthly but at a reasonable amount. Her finances in general are crazy because she allowed her credit card to be used so much that she couldn’t pay for something when it became an
2. She is right regarding taking classes to acquire new skills that could get her a better job; however she has to take care of all the other aspects of her financial situation in order to do so. Once her net cash flow is positive, she can start planning going back to school.
The pool cost the petitioner over $19,000, and we cannot accept his contention that such amount was spent primarily for therapy for his leg in view of the limited need for such therapy and the alternatives which were then available.
Parent Corporation owns 85% of the common stock and 100% of the preferred stock of Subsidiary Corporation. The common stock and preferred stock have adjusted bases of $500,000 and $200,000, respectively, to Parent. Subsidiary adopts a plan of liquidation on July 3 of the current year, when its assets have a $1 million FMV. Liabilities on that date amount to $850,000. On November 9, Subsidiary pays off its creditors and distributes $150,000 to Parent with respect to its preferred stock. No cash remain to be aid to Parent with respect to the remaining $50,000 of its liquidation preference for the preferred stock, or with respect to any common stock. In each of Subsidiary’s tax years, less than %10 of its gross
A true democracy takes lots of organization, commitment and hard work. It takes time to create a true democracy. Over the years Canada’s government has become more and more democratic. Now Canada’s government has many elements of a true democracy with few flaws, allowing Canada’s government to be seen as a true democracy.
Would it be possible to consider placing a flat $.10 FEDERAL TAX on ALL online sales no matter what the cost of the product or service purchased? This is not a percentage of the sale, but a flat tax that would never increase. Most add sales tax to online purchases based on the total sale, but I think there could be significant revenue gained if a SMALL flat Federal Tax was added. If there are approximately 4,000,000,000 online purchases a day, seven days a week, a $.10 (10-cent) Federal Tax added to each transaction could help reduce the deficit without causing a hardship on anyone. The retailer would collect and forwards the Federal Tax to the government at the end of every month, just
case, she uses the money to pay for the rent, bills, child care, gasoline, and food. Most people living
I appreciate the opportunity to advise you regarding the tax treatment for your loss of $25,406 in 2015 from your dog breeding activities. I understand that you decided to start breeding purebred terriers to keep yourself busy after your divorce with your husband in January. There are two possible ways to treat the loss under rulings in the Internal Revenue Code. One option is to treat your dog breeding activity as a business and deduct the losses on Schedule C, Profit or Loss from Business, of your individual income tax return. The second option is to treat your dog breeding as an activity not engaged in for profit, which does not allow you to deduct the
She has a financially supportive husband who works to support both her and her children. This source of income will be beneficial for future health needs and other services they require and will ease the financial burden for them a bit.
In order to increase her emergency fund, Shelby will need to create a practical budget and stick to it. She may consider using payment services and savings programs, while reducing banking fees and maximizing earnings on funds. For example, she will need to evaluate and compare the costs of checking and check card services at various financial institutions. She may also want to open up a regular savings account considering it involves a low or no minimum balance. However, with an ease of withdrawal, it has a low rate of return. Another option, for her, is getting a Certificate of Deposit, which is a savings plan, with a guaranteed rate of return for the time of the CD. CD's unfortunately have drawbacks as well, such as a penalty for early withdrawal
Shelby would benefit using the Personal Account Planner sheets. The Payment Account Comparison will allow her to compare services and fees for bank institutions to help determine the best place for her. With her being a full-time student she may benefit from using a 'free" checking account for students. The Checking Account Reconciliation sheet can help Shelby monitor her payment records and help decide what actions can be made to reduce banking service cost.
I am not certain what she should at this point. Her immediate issue is to find extra money from somewhere; perhaps parents, friends, or a short term loan company could help her resolve the issue of car repairs. Perhaps if she has savings, this would be the time to utilize those funds. If not, then maybe her bank will help her out, and extend her a line of credit or short term personal loan. Depending on her credit card servicer, they may extend or raise her credit limit. However, she would likely have to be in good standing thus far.