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tatyana61 [14]
3 years ago
11

In 2016, Sarah (who files as single) had silverware worth $10,000 (basis $6,000) stolen from her home. Sarah's insurance company

told her that her policy did not cover the theft. Sarah's other itemized deductions last year were $2,000. She had AGI of $30,000 last year. In August of 2017, Sarah's insurance company decided that Sarah's policy did cover the theft of the silverware and they paid Sarah $5,000. Determine the tax treatment of the $5,000 received by Sarah during 2017.
a. $5,000 should be included in gross income.
b. Last year's return should be amended to include the $5,000.
c. None of the $5,000 should be included in gross income.
d. $2,900 should be included in gross income.
e. None of these choices are correct
Business
1 answer:
-BARSIC- [3]3 years ago
5 0

Answer:

C) None of the $5,000 should be included in gross income.

Explanation:

During 2016, Sarah's itemized deductions (other than the stolen silverware) were only $2,000. If Sarah wanted to deduct the stolen silverware, she could have taken a casualty loss = $6,000 - $100 - $3,000 = $2,900. Her total itemized deductions would equal $2,000 + $2,900 = $4,900.

But during that year, Sarah should have opted for a standard deduction of $6,300 which is higher than her itemized deductions. That means that Sarah didn't claim any deduction for her silverware, so any money received from the insurance company should not be included in her gross income.

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What are capital gains on an investment.
Vlad1618 [11]

Answer:

A capital gain is, to put it simply, a rise in the value of an investment over its initial purchase price, such as stocks, mutual fund shares, or shares of an exchange traded fund. You have a capital gain if the asset's value rises, and you must pay tax on it

Hope this helped!

3 0
1 year ago
Establishing rules that will help you stay focused is called
Marianna [84]
The answer would be self-discipline 

The definition of self-discipline:   <span>the ability to control one's feelings and overcome one's weaknesses; the ability to pursue what one thinks is right despite temptations to abandon it.</span>
7 0
3 years ago
Read 2 more answers
On June 30, 20X5, Mill Corp. incurred a $100,000 net loss from disposal of a business segment. Also, on June 30, 20X5, Mill paid
OleMash [197]

Answer:

$120,000

Explanation:

Total amount for inclusion in determining Mill Corp's net income or loss is as follows.

  • Net loss from disposal of business segment = $100,000
  • Property tax for 6 months to June 30, 20x5= $40,000 * 0.5 = $20,000

Therefore, total amount for inclusion = $100,000 + $20,000 = $120,000.

3 0
2 years ago
A bond has a face value of $1,000, a coupon of 4% paid annually, a maturity of 30 years, and a yield to maturity of 7%. What rat
Lelechka [254]

Answer:

-11.8%

Explanation:

the key to answer this question is to remember that valuation of a bond depends basically of calculating the present value of a series of cash flows, so let´s think about a bond as if you were a lender so you will get interest by the money you lend (coupon) and at the end of n years you will get back the money you lend at the beginnin (principal), so applying math we have the bond value given by:

price=\frac{principal*coupon}{(1+i)^{1} }+ \frac{principal*coupon}{(1+i)^{2} } \frac{principal*coupon}{(1+i)^{3} }+...+\frac{principal+principal*coupon}{(1+i)^{n} }

so in this particular case that one year later there are 29 years to maturity so we have:

price=\frac{1,000*0.04}{(1+0.08)^{1} }+ \frac{1,000*0.04}{(1+0.08)^{2} } \frac{1000*0.04}{(1+0.08)^{3} }+...+\frac{1,000+1,000*0.04}{(1+0.08)^{30} }

price=553.6638

so as we have a higher rate the investment has the next return:

return=\frac{553.66}{627.73} -1

return=-11.8\%

4 0
2 years ago
Sammy and Monica, both age 67, incur and pay medical expenses in excess of insurance reimbursements during the year as follows:
Mademuasel [1]

Answer:

The Sammy and Monica’s medical expense deduction for regular income tax purposes is $17,750.

Explanation:

For the purpose of regular income tax, the deduction pertaining to medical expenses are available up to the extent it exceeds 10% of AGI.

Deduction available = excess expenses incurred - 7.5% of AGI

                                 = ($16,000  + 4,000  + 2,500 +5,000) - 7.5%*130000

                                  = 27500 - 9.750

                                  = $17,750

Therefore, The Sammy and Monica’s medical expense deduction for regular income tax purposes is $17,750.

5 0
3 years ago
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