6 tom a carpenter buys 100 shares at 10 a share of

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6. Tom, a carpenter, buys 100 shares at $10 a share of ACME corporation, two years later he gives the stock to a friend who built him a greenhouse for free. The green house work was worth $500 and the stock is now worth $500 as well. Does Tom have any tax liabilities from this transaction? a. No, since this is a mere barter exchange relationship b. No, the stock never increased in value so there is no realization event c. Yes, Tom has gained $500 in income for the free greenhouse work. d. Yes, Tom has an imputed income of $500 since he, as a carpenter, could have built himself the green house
7. Clara buys a home from her sister for $400k despite market price being $500k, during a remodel of the basement Clara finds D.B. Coopers body and a million dollars in cash. What are Clara’s tax implications?
8. Dr. Henry Jones, an archaeology professor at the local community college, was hired by government officials in 1936 to retrieve a lost item from an undisclosed location in Egypt. While preparing for his trek into the unhospitable desert, Dr. Jones decided to do some shopping in the local bazaar. He purchases a small wooden box with decorative molding and finishing. Dr. Jones throws the box into his carry-on luggage and promptly forgets about the box. Three years later, in 1939, Dr. Jones stumbles across the box in his baggage and realizes it has a false bottom. Inside the compartment is ancient Egyptian currency with a fair market value of $12,000 USD. Does Dr. Jones have to pay income tax on the ancient Egyptian currency, and if so, in what year?
d. No, he does not have to pay income tax as treasure trove is not considered gross income. e. No, he does not have to pay income tax since he came into possession of the ancient currency in Egypt. 9. Dr. Emmet Brown gained global recognition in 1985 for inventing a motorized time machine. Because of his fame, he was hired by Lloyd Industries in 1986 to serve as Chief Scientific Officer. His job responsibilities included inventing new gadgets for his time machine and writing scientific papers. In 1988, Lloyd Industries decided to hold a scientific conference in Hill Valley, California. Lloyd Industries paid for Dr. Brown’s flights, lodging, and food. The conference was 7 days long and consisted of one staff meeting. The rest of the week consisted of musical performances, fancy dinners, and an “enchantment under the sea” dance. Is Dr. Brown required to report the trip as gross income on his taxes?

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