![PRINCIPLES OF TAXATION F/BUS...(LL)](https://www.bartleby.com/isbn_cover_images/9781260433197/9781260433197_largeCoverImage.gif)
PRINCIPLES OF TAXATION F/BUS...(LL)
23rd Edition
ISBN: 9781260433197
Author: Jones
Publisher: MCG
expand_more
expand_more
format_list_bulleted
Question
Chapter 18, Problem 12QPD
To determine
Identify whether Person N’s action irrational in spending so much money to avoid the penalty.
Expert Solution & Answer
![Check Mark](/static/check-mark.png)
Want to see the full answer?
Check out a sample textbook solution![Blurred answer](/static/blurred-answer.jpg)
Students have asked these similar questions
Craig commits fraud on his tax return. It is found that he was $40,000 deficient in his tax because of the fraud. What would his penalty be? Please show all calculations to demonstrate how you arrived at your answer.
In your response, please make sure to take all of the facts above into consideration. You can refer back to the text, lecture videos, and the IRS website.
John and Marsha are married and filed a joint return for the past year. During that year, Marsha was employed as an assistant cashier at a local bank and, as such, was able to embezzle $75,000, none of which was reported on their joint return. Before the defalcation was discovered, Marsha disappeared and has not been seen or heard from since. List as many tax research issues as you can to determine the tax consequences of this crime. Do not attempt to answer any of the questions you raise. Simply identify the research issues.
John filed his individual income tax return 3½months after it was due. He had not requested an extension of time for filing. Along with his return, John remitted a check for $1,000, which was the balance of the taxes he owed with his return. Disregarding interest, calculate the total penalty that John will be required to pay, assuming the failure to file was not fraudulent (and that he is not subject to failure-to-pay penalties).
Chapter 18 Solutions
PRINCIPLES OF TAXATION F/BUS...(LL)
Ch. 18 - Prob. 1QPDCh. 18 - Prob. 2QPDCh. 18 - Prob. 3QPDCh. 18 - Prob. 4QPDCh. 18 - Prob. 5QPDCh. 18 - Prob. 6QPDCh. 18 - Prob. 7QPDCh. 18 - Prob. 8QPDCh. 18 - Prob. 9QPDCh. 18 - Prob. 10QPD
Ch. 18 - Prob. 11QPDCh. 18 - Prob. 12QPDCh. 18 - Prob. 13QPDCh. 18 - Prob. 14QPDCh. 18 - Prob. 1APCh. 18 - Prob. 2APCh. 18 - Prob. 3APCh. 18 - Prob. 4APCh. 18 - Prob. 5APCh. 18 - Prob. 6APCh. 18 - Prob. 7APCh. 18 - Prob. 8APCh. 18 - Prob. 9APCh. 18 - Prob. 10APCh. 18 - Prob. 11APCh. 18 - Prob. 12APCh. 18 - A revenue agent determined that Ms. Owen underpaid...Ch. 18 - Prob. 14APCh. 18 - Prob. 15APCh. 18 - Prob. 16APCh. 18 - Prob. 17APCh. 18 - Prob. 18APCh. 18 - Prob. 19APCh. 18 - Prob. 20APCh. 18 - Prob. 22APCh. 18 - Prob. 8IRPCh. 18 - Prob. 9IRPCh. 18 - Prob. 1RPCh. 18 - Prob. 2RPCh. 18 - Prob. 1TPCCh. 18 - Prob. 2TPC
Knowledge Booster
Similar questions
- Last summer, Casey mowed lawns to earn extra money. He was paid $250 in cash, and no deductions were made from his pay. Casey did not re files his tax return, he is required to report this income. True or False? True Falsearrow_forwardJoan filed her individual income tax return 3 months after it was due. She did not request an extension of time for filing. Along with her return, Joan remitted a check for $125, which was the balance of the taxes she owed with her return. Disregarding interest, calculate the total penalties that Joan will be required to pay, assuming the failure to file was not fraudulent.arrow_forwardCooper is a CPA and prepared several tax returns during the current tax year for compensation. In the rush to get returns filed timely, he failed to sign three of the returns that he prepared. How much is his failure to sign penalty? Question 12 options:arrow_forward
- Irwin Schiff is a self-styled “tax rebel” who has made a career, and substantial profit, out of his tax protest activities. On February 7, Schiff appeared live on CBS News Nightwatch, a late-night program with a viewer participation format. During the broadcast, Schiff repeated his assertion that nothing in the Internal Revenue Code stated that an individual was legally required to pay federal income tax. Schiff then challenged, “If anybody calls this show—I have the Code—and cites any section of this Code that says an individual is required to file a tax return, I will pay them $100,000.” Call-in telephone numbers were periodically flashed on the screen. John Newman, an attorney, did not see Schiff’s live appearance on Nightwatch. Newman did, however, see a twominute videotaped segment, including Schiff’s challenge, which was rebroadcast several hours later on the CBS Morning News. Newman researched the matter that same day and on the following day, February 9, placed a call using…arrow_forwardJuan inquired from the BIR whether or not he will be covered with the new tax law. The BIR issued an administrative ruling that his activities are not covered by the new tax law. As a result, Juan did not pay his tax for several years based on the said BIR ruling. Currently, the BIR Commissioner found out that the previous ruling was erroneous and reversed the same with a new BIR ruling. The BIR then issued tax assessment against Juan for purposes of collecting back taxes.Is the tax assessment against Juan correct? A. Yes, because the previous BIR ruling was corrected and the activities of Juan should have been taxable. B. Yes, because the ruling of the BIR Commissioner must be final. C. No, Juan should be exempted from paying taxes under the old and new law. D. No, because reversal of BIR ruling shall not be retroactive in application especially if the ruling is prejudicial to the taxpayerarrow_forwardGrace is an officer of a local bank that merges with a national bank, resulting in a change of ownership. She loses her job as a result of the merger, but she receives a cash settlement of $590,000 from her employer under her golden parachute. Her average annual compensation for the past five tax years was $200,000. If an amount is zero, enter "0". a. What are the tax consequences to Grace and the bank of the $590,000 payment? The $590,000 payment - considered a golden parachute payment. Therefore, the bank is allowed a deduction of $ Grace has taxable income of $ and is liable for an excise tax of $ b. Assume instead that Grace's five-year average annual compensation was $110,000 and that she receives $390,000 in the settlement. What are the tax consequences to Grace and the bank? The $390,000 payment considered a golden parachute payment. Therefore, the bank is allowed a deduction of Grace has taxable income of $ and is liable for an excise tax of $arrow_forward
- Isko owns a residential condominium unit in Manila Prime Towers Condominium (MPTC), which he later on sold to Bato. Apparently, Isko did not report such sale; did not pay the capital gains tax due; and did not declare the proceeds of sale as part of his income when he filed his tax returns. On a routine examination, the Bureau of Internal Revenue (BIR) happens to check on Isko’s tax returns. Knowing that Isko had a unit in MPTC, BIR asked management of information about it and its ownership status, which MPT complied. BIR learned that Isko did not register his sale of his unit and pay the taxes due, hence, he was assessed with deficiency taxes. Isko now questions the act of MPTC in providing his information and data to the BIR. He claims that he was not inform by the MPTC and did not authorize the giving of such information. He said that MTC violated his rights under the Data Privacy Act. Is Isko correct? Why or why not. Support your answer with the provision/s of the law.arrow_forwardKyle provides landscaping services to a number of clients. In filing his current-year income tax return, Kyle excluded revenue received from cash customers. If Kyle is found guilty of fraud, he may be subject to all of the following except: a. Other penalties as provided by law. b. A fine for not more than $250,000. c. Being held responsible for the costs of prosecution. d. Imprisonment for not more than 2 yearsarrow_forward. Jack filed his tax return 8 months and 27 days late and did not request an extension of time for filing. Jack's return indicated that he is to receive a $9,695 refund in taxes. Calculate the amount of Jack's penalty for failure to file his tax return on time, assuming the failure-to-file was not fraudulent.$arrow_forward
- Andrea's 2020 return was audited by the IRS. Andrea failed to report taxable interest income on her return, which resulted in an assessment of $8,000 in tax. Assuming her actions were intentional and fraudulent, what is her accuracy penalty?arrow_forwardT uses frequent flyer miles to take his family on a vacation. T received the miles duringbusiness travel paid for by his employer. The normal airfare for his vacation wouldhave cost $7,000.a. T must realize and recognize $7,000 as income.b. Although T has realized income, he will not be required to recognize it becausethe IRS has chosen, as a matter of administrative convenience, not to requiretaxpayers to recognize the value of frequent flyer tickets earned duringemployer-paid travel.c. Had T earned the frequent flyer miles during travel he had paid for himself, theissue of income realization and recognition would not arise.d. Both (a) and (c) are correct.e. Both (b) and (c) are correct. T buys a parcel of real estate for $100,000, which he finances by giving the seller a nonrecoursemortgage for the full purchase price. The debt is due in one balloon payment inYear 5. When the debt becomes due in Year 5, T decides to give the property back to theseller in satisfaction of the debt…arrow_forwardJames has just been audited by the IRS and, as a result, has been assessed a substantial deficiency (which he has not yet paid) in additional income taxes. In preparing his defense, James advances the following possibilities. Are any of them viable? Although a resident of Texas, James plans to sue in a District Court in Oregon that appears to be more favorably inclined toward taxpayers. If (a) is not possible, James plans to take his case to a Texas state court as he is more familiar with the practices there. Yes If he loses at the trial court level, James plans to appeal to either the Federal Circuit or the 11th Circuit Court of Appeals because he has relatives in both Washington D.C., and Atlanta. Staying with these relatives could save James lodging expense while his appeal is being heard by the court. Even if he does not win at the trial court or appeal court level, James feels certain of success on an appeal to the Supreme Court.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you