CengageNOWv2, 1 term Printed Access Card for Hoffman/Young/Raabe/Maloney/Nellen's South-Western Federal Taxation 2018: Individual Income Taxes, 41st
41st Edition
ISBN: 9781337389518
Author: William H. Hoffman, James C. Young, William A. Raabe, David M. Maloney, Annette Nellen
Publisher: Cengage Learning
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Question
Chapter 9, Problem 42P
To determine
Determine Person D’s QBI deduction.
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Terry owns land that serves as security for a $50,000 mortgage held by Key Bank. When Terry's tax basis is the land was $15,000 and the land's fair market value was $40,000, Key Bank forecloses on the land and takes title in full satisfaction of the mortgage balance. Which of the following statements is correct?
a. If the mortgage is recourse, Terry must recognize gain on the foreclosure but no income from the discharge of indebtedness.
b. If the mortgage is nonrecourse, Terry must recognize gain on the foreclosure but no income from the discharge of indebtedness.
c. Terry only recognizes income from the discharge of indebtedness if the land was used in a trade or business.
d. If the mortgage is nonrecourse, Terry must recognize gain on the foreclosure and income from the discharge of indebtedness. None of the above e.
Nancy contributed $50,000 of cash and land with a fair market
value of $100,000 and an adjusted basis of $50,000 to Kale, Inc.
(an S corporation) when it was formed. The land was
encumbered by a $30,000 mortgage. What is Nacy's tax basis in
Kale, Inc. after formation? (Assume the liability includes no
personal indebtedness and that the control requirement is met
for purposes of Sec. 351)
Select one:
OA. $40,000
OB. $70,000
OC. $100,000
OD. $150,000
Lance contributed investment property worth $500,000, purchased three years ago for $200,000 cash, to Cloud Peak LLC in exchange for an 85 percent profits and capital interest in the LLC. Cloud Peak owes $300,000 to its suppliers but has no other debts.a. What is Lance’s tax basis in his LLC interest?
b. What is Lance’s holding period in his interest?
c. What is Cloud Peak’s basis in the contributed property?
d. What is Cloud Peak’s holding period in the contributed property?
Chapter 9 Solutions
CengageNOWv2, 1 term Printed Access Card for Hoffman/Young/Raabe/Maloney/Nellen's South-Western Federal Taxation 2018: Individual Income Taxes, 41st
Ch. 9 - Prob. 1DQCh. 9 - Mason performs services for Isabella. In...Ch. 9 - Milton is a resident of Mobile (Alabama) and is...Ch. 9 - Prob. 4DQCh. 9 - Prob. 5DQCh. 9 - Prob. 6DQCh. 9 - Prob. 7DQCh. 9 - Prob. 8DQCh. 9 - Prob. 9DQCh. 9 - Prob. 10DQ
Ch. 9 - Prob. 11DQCh. 9 - Prob. 12DQCh. 9 - Prob. 13DQCh. 9 - Prob. 14DQCh. 9 - Prob. 15DQCh. 9 - Prob. 16CECh. 9 - Fred, a self-employed taxpayer, travels from...Ch. 9 - Prob. 18CECh. 9 - Prob. 19CECh. 9 - Prob. 20CECh. 9 - Prob. 21CECh. 9 - Prob. 22CECh. 9 - Cindy maintains an office in her home that...Ch. 9 - Prob. 24CECh. 9 - Prob. 25CECh. 9 - Prob. 26PCh. 9 - Prob. 27PCh. 9 - Prob. 28PCh. 9 - In June of this year, Dr. and Mrs. Bret Spencer...Ch. 9 - Prob. 30PCh. 9 - On Thursday, Justin flies from Baltimore (where...Ch. 9 - Monica, a self-employed taxpayer, travels from her...Ch. 9 - Prob. 33PCh. 9 - Prob. 34PCh. 9 - Prob. 35PCh. 9 - Prob. 36PCh. 9 - Prob. 37PCh. 9 - Prob. 38PCh. 9 - Prob. 39PCh. 9 - Prob. 40PCh. 9 - Prob. 41PCh. 9 - Prob. 42PCh. 9 - Prob. 43PCh. 9 - Prob. 44PCh. 9 - Prob. 45PCh. 9 - Prob. 46PCh. 9 - Prob. 47PCh. 9 - In the current year, Barlow moved from Chicago to...Ch. 9 - Prob. 2CPA
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