1. Marie had a good year. She received the following prizes and awards: - an iPad from The Famous Daytime Talk Show with a fair market value of $500 - lottery winnings of $1,000 received in cash -a plaque worth $25 plus $100 of Godiva chocolate in recognition for 100 days on the job without an accident -a $10,000 cash prize from American Idol How much of her prizes and awards should Marie report on her tax return? a. $11,500; the award from her job is excluded b. $11,600; the plaque may be excluded C. $11,625; everything is included at the highest amount d. $11,000; only cash prizes and awards are included None, they are all excluded from income

1. Marie had a good year. She received the following prizes and awards: - an iPad from The Famous Daytime Talk Show with a fair market value of $500 - lottery winnings of $1,000 received in cash -a plaque worth $25 plus $100 of Godiva chocolate in recognition for 100 days on the job without an accident -a $10,000 cash prize from American Idol How much of her prizes and awards should Marie report on her tax return? a. $11,500; the award from her job is excluded b. $11,600; the plaque may be excluded C. $11,625; everything is included at the highest amount d. $11,000; only cash prizes and awards are included None, they are all excluded from income

Income Tax Fundamentals 2020

38th Edition

ISBN:9780357391129

Author:WHITTENBURG

Publisher:WHITTENBURG

Chapter2: Gross Income And Exclusions

Section: Chapter Questions

Problem 3P

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Noor Patel has had a busy year! She decided to take a cross-country adventure. Along the way, she won a new car on The Price Is Right (valued at $14,600) and $500 on a scratch-off lottery ticket (the first time she ever played). She also signed up for a credit card to start the trip and was given a sign-up bonus of $100. How much from these will she have to include in her federal taxable income?
For each of the following, determine the amount that should be included in gross income: a. Peyton was selected the most valuable player in the Super Bowl. In recognition of this, he was awarded an automobile with a value of 60,000. Peyton did not need the automobile, so he asked that the title be put in his parents names. b. Jacob was awarded the Nobel Peace Prize. When he was presented the check for 1,400,000, Jacob said, I do not need the money. Give it to the United Nations to use toward the goal of world peace. c. Linda won the Craig County Fair beauty pageant. She received a 10,000 scholarship that paid her 6,000 for tuition and 4,000 for meals and housing for the academic year.
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6. In the current year, Clara rented her apartment on AirBnb for 13 days. She received gross rental income of $3,100. Her expenses for the apartment are: - Operating expenses $4,000 - Depreciation $2,000 - Mortgage interest and Property taxes $4,000 - Utilities/repairs $2,000 Calculate the income and expenses reported for the rental activity. What will Clara report on her tax return for this rental activity? $3,100 income, $3,100 expenses $3,100 income, $0 expenses Clara will not report anything. $3,100 income; $12,000 expenses
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