HomeworkLib
Question

Emily is a cash-basis taxpayer, and she was an especially productive salesperson last year. In December...

Emily is a cash-basis taxpayer, and she was an especially productive salesperson last year. In December of last year her supervisor told Emily she had earned a $5,000 bonus. However, Emily received the bonus check after year-end. Identify the principle that will determine when Emily is taxed on the bonus.

A. ASSIGNMENT OF INCOME

B. CONSTRUCTIVE RECEIPT

C. RETURN OF CAPITAL PRINCIPLE

D. WHEREWITHAL TO PAY

E. ALL OF THESE CHOICES ARE CORRECT

business   accounting   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1

B. CONSTRUCTIVE RECEIPT

For federal income tax purposes, the doctrine of constructive receipt is used to determine when a cash-basis taxpayer has received gross income. A taxpayer is subject to tax in the current year if he or she has unfettered control in determining when items of income will or should be paid.

0 0
Add a comment
Know the answer?
Add Answer to:
Emily is a cash-basis taxpayer, and she was an especially productive salesperson last year. In December...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions

  • Oprah is a cash basis taxpayer who is employed in the publishing industry. This year her...

    Oprah is a cash basis taxpayer who is employed in the publishing industry. This year her employer informed her that because of her outstanding performance she is entitled to a free world cruise. Oprah asked her employer to issue the cruise tickets to her parents, and the complied with this request. Identify the principle that will determine whether Oprah or her parents are taxed on the value of the cruise tickets: Assignment if income Constructive receipt Return of capital principle...

  • A cash-basis calendar-year taxpayer received a $3,000 check for an employee bonus during the last week...

    A cash-basis calendar-year taxpayer received a $3,000 check for an employee bonus during the last week of December Which of the following is a true statement? A. TP taxed on the $3,000 of in the year she cashes the check. B. TP is taxed on the $3,000 in the year the check was mailed. C. TP is taxed on the $3,000 in the year she receives the check. D. TP is taxed on the $3,000 in the year she worked....

  • Amy is a calendar year taxpayer reporting on the cash basis. Please indicate how she should...

    Amy is a calendar year taxpayer reporting on the cash basis. Please indicate how she should treat the following items for 2019. A. She makes a deductible contribution to an IRA on April 15, 2020. B. She has made an election to accrue the increase in value of savings bonds even though the increase is not received in cash. C. She prepays half a year of interest in advance on her mortgage on the last day of 2019. D. She...

  • Jason's employer pays year-end bonuses each year on December 31. Jason, a cash-basis taxpayer, would prefer...

    Jason's employer pays year-end bonuses each year on December 31. Jason, a cash-basis taxpayer, would prefer not to pay tax on his bonus this year (and actually would prefer his daughter to pay tax on the bonus). So, he leaves town on December 31, 2018, and has his daughter, Julie, pick up his check on January 2, 2019. Who reports the income and when?

  • Jordan is a calendar year, cash basis taxpayer. He is single, age 67, not blind, and...

    Jordan is a calendar year, cash basis taxpayer. He is single, age 67, not blind, and cannot be claimed as a dependent by anyone else. Based on the following information, what is his taxable income for 2019? Wages from part-time employment $25,000 Holiday bonus paid in Bitcoin $500 Distribution from a traditional IRA $12,000 Interest on savings account $200 Inheritance received upon death of brother $2,500 Total charitable contributions $5,000 Total state income taxes paid $6,000

  • Ms. smith us a 46 year old unmarried cash basis taxpayer. during 2018, Ms smith had...

    Ms. smith us a 46 year old unmarried cash basis taxpayer. during 2018, Ms smith had the following transactions. wages received from abc co 52,000 ms smith invested 1000 in a one year certificate of deposit on july 1 2018, it will be worth 1050 when it matures in 2019 interest earned on a savings account but not withdran: 150 received workers comp while off work due to injurt at company: 10,000 ms smith owed 3000 on personal credit card....

  • Before last year, Ellie (Luke's wife) taught music and earned $30,400. She also earned $9,600 by...

    Before last year, Ellie (Luke's wife) taught music and earned $30,400. She also earned $9,600 by renting out their basement as a studio apartment. Ellie saves every month. At the end of a typical year she would have saved a total of 10% from her wages and the income earned from the basement for the entire year, and earned a total of 0.5% in interest (for the entire year). At the beginning of last year, Ellie stopped teaching music. She...

  • [20] Bob, a calendar-year, cash-basis taxpayer, owns an insurance agency. Bob has four people selling insurance...

    [20] Bob, a calendar-year, cash-basis taxpayer, owns an insurance agency. Bob has four people selling insurance for him. The salesmen incur ordinary and necessary meal and entertainment expenses for which Bob reimburses them monthly. During the current year, Bob reimbursed his agents $10,000 for meals and $26,000 for entertainment. How much of the reimbursement can Bob deduct for meal and entertainment expenses on his current-year federal income tax return? A. $5,000 B. $8,000 C. $30,800 D. $36,000 [21] In January...

  • Comprehensive Income Tax Course: Module 1 4. Randy turned 16 last year and had his first...

    Comprehensive Income Tax Course: Module 1 4. Randy turned 16 last year and had his first summer job. Even though his parents are claiming him as a dependent he wants to file a return in order to get his refund. He receives his W-2 and decides he can do his own return using form 1040-EZ. Which of the following information is not found on a Form W-2? a) The taxpayer’s Social Security number b) The taxpayer’s wages, tips and other...

  • This year Evan graduated from college and took a job as a deliveryman in the city....

    This year Evan graduated from college and took a job as a deliveryman in the city. Evan was paid a salary of $68,500 and he received $700 in hourly pay for part-time work over the weekends. Evan summarized his expenses below: Cost of moving his possessions to the city (125 miles away) Interest paid on accumulated student loans Cost of purchasing a delivery uniform Contribution to State University deliveryman program $1,200 2,840 1,440 1,320 Calculate Evan's AGI and taxable income...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT