Tax Week 6 Analysis

996 Words May 8th, 2012 4 Pages
Team C Homework 6
Comprehensive Problems:
50. Jack and Jill are owners of UpAHill, an S corporation. They own 25 and 75 percent, respectively.

a. What amount of ordinary income and separately stated items are allocated to them for years 1 and 2 based on the information above?

Year 1 Year 2
Ordinary Income Jack (25%) $10,625 $32,750 Jill (75%) $31,875 $98,250
Ordinary income= Overall net income – dividends – interest income
Jack (45,000 – 500 – 2000 * 25%, yr1/ 134,500 – 1,000 – 2,500 * 25%, yr2)
Jill (45,000 – 500 – 2000 * 75%, yr1/ 134,500 – 1,000 – 2,500 * 75%,
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Royalties 0
7. Net short-term capital gain (loss) 0
8a. Net long-term capital gain (loss) 0 b. Colectibles (28%)gain (loss) 0 c.Unrecaptured section 1250 gain 0
9. Net section 1231 gain (loss) 0
10. Other income (loss) 0

c. Complete Jill’s 1120S, Schedule K-1, for year 1.

Jill Year 1 1120S 1. Ordinary business income (loss) 31,875 2. Net rental real estate income (loss) 0
3a. Other Gross rental income (loss) 0 b. Expenses from other rental activities 0 c. Other net rental income (loss) 3b-3a 0
4. Interest income 1,500
5. Dividends: a Ordinary dividends 375

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