Howard O'Brien, an employee of Ogden Corporation, died on June 30, 2015. During July, Ogden made employee death payments (which do not represent the proceeds of life insurance) of $10,000 to his widow, and $10,000 to his fifteen-year-old son. What amounts should be included in gross income by the widow and son in their respective tax returns for 2015?
Widow / Son
a. $5,000 / $5,000
b. $5,000 / $10,000
c. $7,500 / $7,500
d. $10,000 / $10,000
Answer: D
Tax
- The uniform capitalization method must be used by I. Manufacturers of tangible personal property. II. Retailers of personal property with $2 million dollars in average annual gross receipts for the three preceding years.
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- Lake Corp., an accrual basis calendar-year corporation, had the following 2015 receipts. Advanced Rental payments where the lease ends in 2017 : $125,000 Lease cancellation payment from a five-year lease tenant $50, 000 Lake had no restrictions on the use of the advanced rental payments and renders no services. What amount of income should Lake report on its 2015 tax return?
- In 2015, Emil Gow won $5,000 in a state lottery. Also in 2015, Emil spent $400 for the purchase of lottery tickets. Emil elected the standard deduction on his 2015 income tax return. The amount of lottery winning that should be included in Emil's 2015 taxable income is
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- Mr. and Mrs. Alvin Charak took a foster child, Robert, into their home in 2015. A state welfare agency paid the Charaks $3,900 during the year for related expenses. Actual expenses incurred by the Charaks during 2015 in caring for Robert amounted to $3,000. The remaining $900 was spent by the Charaks in 2015 towards their own personal expenses. How much of the foster child payments is taxable income to the Charaks in 2015?
- Income in respect of a cash-basis decedent
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- In 2010, Ross was granted an incentive stock option (ISO) by her employer as part of an executive compensation package. Ross exercised the ISO in 2013 and sold the stock in 2015 at a gain. Ross was subject to regular tax for the year in which the
- Darr. an employee of Sorce C corporation, is not a shareholder. Which of the following would be included in a taxpayer's gross income?
- Bob and Sue Stewart were divorced in 2013. Under the term of their divorce decree, Bob paid alimony to Sue at the rate of $50,000 in 2013, $20,000 in 2014, and nothing in 2015. What amount of alimony recapture must be included in Bob's gross income for 2015?
- In July 1996, Dan Farley leased a building to Robert Shelter for a period of fifteen years at a monthly rental of $1,000 with no option to renew. At that time the building had a remaining estimated useful life of twenty years. Prior to taking possession of the building, shelter made improvements at a cost of $18,000. These improvements had an estimated useful life of twenty years at the commencement of the lease period. The lease expired on June 30, 2015, at which point the improvement had a fair market value of $2,000. The amount that Farley, the landlord, should include in his gross income for 2015 is
- Daniel Kelly received interest income from the following sources during the current year - New York Port Authority Bonds : $1,000 - Puerto Rico Commonwealth bonds : $1,800 What portion of such interest is tax exempt?
- Charles and Marcia are married cash-basis taxpayers. In 2015, they had interest income as follows: - $500 interest on federal income tax refund - $600 interest on state income tax refund - $800 interest on federal government obligations. - $1,000 interest on state government obligations. What amount of interest income is taxable on Charles and Marcia's 2015 joint income tax return?
- During the current year Hal Leff sustained a serious injury in the course of his employment. As a result of this injury, Hal received the following payments during the year: Worker's compensation ------------ $2,400 Reimbursement from his employer's accident and health plan for medical expenses paid by Hal and not deducted by him --------------------$1,800 Damages for physical injuries ----------------------$8,000 The amount to be included in Hal's gross income for the current year should be
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