sm05 - CHAPTER 5 DEDUCTIONS AND LOSSES: IN GENERAL...

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Unformatted text preview: CHAPTER 5 DEDUCTIONS AND LOSSES: IN GENERAL SOLUTIONS TO PROBLEM MATERIALS Status: Q/P Question/ Present in Prior Problem Topic Edition Edition 1 Allowed income and deductions Unchanged 1 2 Deductions for and from AGI New 3 Deductions from AGI Unchanged 3 4 Deductions for and from AGI Unchanged 4 5 Deductions for and from AGI Unchanged 5 6 Deductions for and from AGI Unchanged 6 7 Trade or business expense Unchanged 7 8 Ordinary and necessary requirement Unchanged 8 9 Reasonable compensation Unchanged 9 10 Business versus nonbusiness losses New 11 Reporting procedures Unchanged 11 12 Method of accounting: cash versus accrual Unchanged 12 13 Timing of deduction by cash basis taxpayer Unchanged 13 14 All events and economic performance tests Unchanged 14 15 Reserves and economic performance test New 16 Illegal activities Unchanged 16 17 Issue recognition Unchanged 17 18 Legal expenses Unchanged 18 19 Illegal activities Modified 19 20 Political contributions Unchanged 20 21 Lobbying expenditures Unchanged 21 22 Excessive executive compensation Unchanged 22 23 Investigation of a business Unchanged 23 24 Hobby/business Unchanged 24 25 Vacation home rental: classification Modified 25 26 Vacation home rental: loss Unchanged 26 27 Issue recognition Unchanged 27 5-1 5-2 2002 Comprehensive Volume/Solutions Manual Status: Q/P Question/ Present in Prior Problem Topic Edition Edition 28 Conversion of a residence to rental property Unchanged 28 29 Another taxpayers obligation Unchanged 29 30 Personal expenses versus deductible legal expenses Unchanged 30 31 Issue recognition Unchanged 31 32 Tax-exempt income/expenses New * 33 Deductions for and from AGI Modified 33 * 34 Deductions for and from AGI Unchanged 34 * 35 Deductions for and from AGI Unchanged 35 36 Reasonable salaries Unchanged 36 * 37 Business and nonbusiness losses Modified 37 * 38 Cash method versus accrual method Unchanged 38 39 Cash basis and prepaid expenses Unchanged 39 * 40 Economic performance test Unchanged 40 41 Legal expenses and public policy limitations Unchanged 41 * 42 Illegal business Modified 42 43 Lobbying expenses Unchanged 43 44 Excessive executive compensation Unchanged 44 * 45 Excessive executive compensation Unchanged 45 46 Investigation of a business Unchanged 46 47 Investigation of a business Unchanged 47 * 48 Hobby/business Unchanged 48 * 49 Hobby losses/business Unchanged 49 50 Vacation home rental: exclusion Modified 50 * 51 Vacation home rental: Courts approach Unchanged 51 and IRSs approach * 52 Vacation home rental: use for 12 days Unchanged 52 * 53 Taxable income calculation and vacation home Unchanged 53 * 54 Another taxpayers obligations Unchanged 54 55 Capital expenditure and amortization Unchanged 55 56 Capital expenditures and amortization Unchanged 56 57 Losses between related parties Unchanged 57 58 Deductions between related parties and Unchanged 58 constructive ownership * 59 Losses between related parties New 60 Tax-exempt income/expenses Unchanged...
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sm05 - CHAPTER 5 DEDUCTIONS AND LOSSES: IN GENERAL...

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