SWFT Comprehensive Volume 2019
42nd Edition
ISBN: 9780357233306
Author: Maloney
Publisher: Cengage
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Students have asked these similar questions
Craig commits fraud on his tax return. It is found that he was $40,000 deficient in his tax because of the fraud. What would his penalty be? Please show all calculations to demonstrate how you arrived at your answer.
In your response, please make sure to take all of the facts above into consideration. You can refer back to the text, lecture videos, and the IRS website.
During 2020, Jackie sent her brother Junnie $2,500 via a telegraphic transfer through El Banco Prieto. The bank’s remittance clerk made a mistake and credited Junnie with $250,000 which he promptly withdrew. The bank demanded the return of the mistakenly credited excess, but Junnie refused to do so. The BIR entered the picture and investigated Junnie. Would the BIR be correct if it determines that he earned a taxable income under the facts?
No, it was not her fault that the funds in excess of $2,500 were credited to him.
Yes, income is a taxable income regardless of the source
No, he had no income because he had no right to the mistakenly credited funds.
No, the funds in excess of $2,500 were in effect donated to her.
If Bob takes an improper deduction for
$10,000 by mistake because he
misunderstood the tax law, and Jane
knowingly takes a $10,000 improper
deduction because she thinks the IRS will not
catch it, then should the two taxpayers be
treated differently?
If your answer is yes that Bob should not be
viewed as a tax evader, then what is stopping
Jane from asserting ignorance if she is
caught?
Knowledge Booster
Similar questions
- Tim receives a $25,000 gift from his parents for a down payment on a house. They know he cannot buy a house without their help. They write “gift” in the memo line of the check. How much of the gift is taxable to Tim? In your response, please make sure to take all of the facts above into consideration. You can refer back to the text, lecture videos, and the IRS website. Please make sure to support whatever conclusion you decide to present.arrow_forwardIf Mrs A worked at a jewellery store and her employer gave her a sales bonus of a diamond ring valued at $10,000 how would you treat this for taxation purposes? Briefly explain making reference to any relevant case law.arrow_forwardFor tax year 2019, the IRS assesses a deficiency against David for $500,000. a. Disregarding the interest component, enter David's penalty if the deficiency is attributable to negligence: $fill in the blank 00862dfde01c05d_1. b. Disregarding the interest component, enter David's penalty if the deficiency is attributable to civil fraud: $fill in the blank c83f71023f93fbc_1.arrow_forward
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