(4 points) Gemini Auto Repair is a calendar year taxpayer. In 2023, the repair shop purchased a light weight truck that it used to drive customers back and forth to their cars while the shop worked on their cars (i.e. for business purposes). In 2024, it sold the truck for a total gain of $34,000 and the accumulated depreciation for the truck was $14,700. What was the character of the 2024 gain on the sale of the truck, assuming that Gemini did not sell any other assets that year and that the shop had not had any Sec. 1231 losses in the past 10 years? If there is more than one type of character that is relevant to the gain, state the specific dollar amount associated with each type of character that makes up the total gain and/or income from the sale transaction for Gemini in 2024.

A 45-year-old client has a goiter. They are being seen by the community health nurse for teaching and follow-up care regarding which nutritional deficiency?

(4 points) A new vintage clothing store began operating within 2024. Its is organized as a corporation, operates over a calendar year tax period, and opened its doors (began business) on April 1, 2024. Assume the total amount of start-up costs for the company was $25,000 and for organizational expenditures was $20,000. What amount of the start-up costs can be immediately expensed in 2024? Of the portion of these start-up costs that could not be immediately expensed, how much amortization expense can the business claim for 2024?

(1 point) For the following scenario, determine whether the book-tax difference (if any) in 2015 is permanent or temporary. On January 1, 2015, Landmark Corporation offered its CFO 2,800 NQOs options to purchase the company’s at the same price offered by the public market on that day, $8/share, at any date in the future after the CFO vests. The CFO will vest 25% of its options in 2015, 25% in 2016, and vest the remaining portion in 2017. The CFO promptly exercised all of his options on December 31, 2017 when he was 100% vested and turned around and sold all the shares for $15/share on the public market. Assume that on the grant date, Landmark Corporation estimated the value of the options would be $7/share. The company uses a calendar year tax period.

(2 points) Which of the following is NOT a separately stated item that a partnership must report separately from ordinary income on its Schedule K?

(1 point) For the following scenario, determine the dollar amount of the book-tax difference (if any) written as a positive number in 2015. On January 1, 2015, Landmark Corporation offered its CFO 2,800 NQOs options to purchase the company’s at the same price offered by the public market on that day, $8/share, at any date in the future after the CFO vests. The CFO will vest 25% of its options in 2015, 25% in 2016, and vest the remaining portion in 2017. The CFO promptly exercised all of his options on December 31, 2017 when he was 100% vested and turned around and sold all the shares for $15/share on the public market. Assume that on the grant date, Landmark Corporation estimated the value of the options would be $7/share. The company uses a calendar year tax period.

(1 point) Cost Recovery Methods – What cost recovery method (if any) should be used for costs from the purchase of a work desktop computer?

(5 points) Marla is one of three partners in a partnership for a silk-screen t-shirt shop called Smar-Tees and all partners are active in the management of the company. The company uses a calendar year tax period. During Year 1, the partnership had an ordinary loss where the amount of loss allocated to Marla based on her profits interest percentage is $45,000. Assume that Marla’s adjusted (ending) outside basis incorporating everything relevant for her basis from Year 1 except this loss allocated to her is $38,000. Using only the information available in the above scenario and ignoring any role of the QBI deduction (if applicable) for this calculation, what will Marla’s adjusted (ending) outside basis be after incorporating the loss and how much of the partnership loss will she get to use on her individual tax return for Year 1?

(1 point). For the following scenario, determine whether the related book-tax difference (if any) is temporary or permanent. Hilton Corporations is considering adding a new hotel location in Santa Fe, NM. It sends two employees to survey the area during the year. The company pays $1,000 for flights, no cost for lodging (uses one of its alternative local hotel locations to house them), and $300 for meals. The employees spent the entire trip doing work for the project (no personal use time).

(1 point). For the following scenario, determine the dollar amount of book-tax difference (if any) written as a positive number. Patriot Construction Co. received $11,500 in interest income on a municipal bond it holds for the city of Falls Church during the year.