Included in j an envelope containing 8000 found and

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Included in j. An envelope containing $8,000 found (and unclaimed) by the taxpayer in a bus station.Included in FeedbackThe Internal Revenue Code defines gross income broadly as "except as otherwise provided …, all income from whatever source derived." Congress has chosen to exclude certain types of income from the income tax base.Answers: Included in; Excluded from; Included in; Excluded from; Excluded from; Excluded from; Included in; Included in; Included in; Included in.The phrase "except as otherwise provided" refers to exclusions. However, gross income does not include unrealizedgains or a return of capital or receipt of borrowed funds. Therefore, if an item is not specifically excluded, it is considered part of gross income for tax purposes.a. Alimony payments received (relates to a divorce settlement in 2016).Included in.For payments required under divorce or separation instruments that are executed prior toJanuary 1, 2019, the deduction for alimony payments is allowed. As result, recipients of these alimony payments will include them in taxable income.b.Damages award received by the taxpayer for personal physical injury—none were for punitive damages.Excluded from.Damages for personal injury or sickness are excluded.c. A new golf cart won in a church raffle.Included in.Prizes are included in gross income.d.Amount collected on a loan previously made to a collegefriend.Excluded from.This is excluded from gross incomepresuming no interest is charged.e. Insurance proceeds paid to the taxpayer on the death ofher uncle—she was the designated beneficiary under the policy.Excluded from.Life insurance proceeds paid to the beneficiary because of the death of the insured are exempt from income tax.f. Interest income on City of Chicago bonds.Excluded from.Interest on municipal bonds is tax exempt.g.Jury duty fees.Included in.Jury duty fees are considered
compensation and included in gross income.h.Stolen funds the taxpayer had collected for a local food bank drive.Included in.Embezzled or stolen funds are taxable.i. Reward paid by the IRS for information provided that led to the conviction of the taxpayer's former employer for tax evasion.Included in.Rewards are considered payment for services and, as such, are fully taxable.j. An envelope containing $8,000 found (and unclaimed) by the taxpayer in a bus station.Included in.This is not considered to be a gift; instead, any property "found" (i.e., a treasure trove)that the taxpayer retains is included in gross income at its fair market value. Since the property was unclaimed, it is assumed that the taxpayer keptthe money; therefore, it is included in gross income.Exercise 3-20 (LO. 2)Sam and Abby are dependents of their parents, and each has income of $2,100 for the year. Sam's standard deduction for the year is $1,050, while Abby's is $2,450.

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