01 Jan What is the amount,

KAPLAN AC256 UNIT 1 DISCCUSSION

Discussion

The first federal income tax was passed in 1861. When was the next one passed and why was it necessary? Why was pay-as-you-go withholding needed in 1943?

KAPLAN AC256 UNIT 2 DISCCUSSION

Discussion

Discuss whether or not the below listed actions are tax avoidance or tax evasion. Then, discuss the ethical implications of employing each of these in a tax return.

1. Keeping a log of business expenses

2. Ignoring earnings from a lawn mowing business

3. Not reporting interest earned on a savings account

4. Keeping a log of contributions to a charity

5. Not reporting tips

6. Claiming your dependents as tax deductions

KAPLAN AC256 UNIT 3 DISCCUSSION

Discussion

George, a wealthy investor, is uncertain whether he should invest in taxable or tax-exempt bonds. What tax and nontax factors should be considered?

George needs assistance understanding the different application of prepaid income under tax law and financial accounting. Explain this difference to George.

KAPLAN AC256 UNIT 4 DISCCUSSION

Discussion

Individuals who own homes may take a tax deduction for interest paid. Many individuals believe that this tax law discriminates against individuals who rent. Do you think this deduction is discriminatory? Explain and share your thoughts.

Additionally, gifts and inheritances have been excluded from gross income since 1913. Discuss the tax consequences of gifts made of property and any income produced by the property. What, if any, are the exclusions and taxable income according to Section 102.

KAPLAN AC256 UNIT 5 DISCCUSSION

Discussion

Vincent pays $20,000 for equipment to use in his trade or business. He pays sales tax of $800 as a result of the purchase. Must the $800 tax be capitalized as part of the purchase price?

Vincent’s friend tells him that capital gains tax is discriminatory in that it is imposed upon individuals who can afford to buy capital assets. Do you agree or disagree? Why? Why not? Be sure to include definitions of capital asset and capital gain in your response.

KAPLAN AC256 UNIT 6 DISCCUSSION

Discussion

What is the distinction between deductions for AGI and deductions from AGI and why should this be important for individuals?

As you review deductions from AGI and for AGI, how should bribes and kickbacks be treated for tax purposes? Are they a deduction and are they allowed? As you may recall, Al Capone’s conviction caused mobsters and other illegal gangsters to rethink their method of keeping detailed records. Why did this rethink occur? How different was this situation of bribes and kickbacks to how multimillion-dollar corporations do business now?

KAPLAN AC256 UNIT 7 DISCCUSSION

Discussion

Identify some common miscellaneous itemized deductions and identify any limitations that are imposed on the deductibility of these items.

One itemized deduction allowed is for medical expenses. In what cases are medical insurance premiums paid by an individual not deductible as qualified expenses?

KAPLAN AC256 UNIT 8 DISCCUSSION

Discussion

When property is disposed of, what factors influence the amount of the deductible loss? Define.

What is the importance, if any, of passive activity?

Compare and contrast the computational rules for deducting casualty losses on personal-use property with casualty losses incurred on business or investment property. Define the difference. What are the limitations for both?

KAPLAN AC256 UNIT 9 DISCCUSSION

Discussion

Ashley is an attorney who specializes in family law. She uses the cash method of accounting and is a calendar-year taxpayer. Last year, she represented a client in a lawsuit and billed the client $5,000 for her services. Although she made repeated attempts, Ashley was unable to collect the outstanding receivable. Finally, in November of the current year, she finds out that the individual has moved without leaving any forwarding address. Ashley’s attempts to locate the individual are futile.

What is the amount, if any, of the deduction that she may claim in connection with this bad debt?

KAPLAN AC256 UNIT 10 DISCCUSSION

Discussion

Both nondeductible contributions to a traditional IRA and contributions to a Roth IRA are similar in the sense that neither provides a tax deduction at the date of contribution. Which of the two types would be most advantageous to taxpayers and why?

Your client is about to establish his own business and hires at least 10 employees. They ask you for advice concerning establishing a qualified versus a non-qualified retirement plan. What do you advise your client? Would your answer change if you were a potential employee? Why or why not?