1)In 2014, Tony and Rhonda acquired land for $600,000, with Tony furnishing $200,000 and Rhonda $400,000 of the purchase price. Title to the property is listed as equal joint tenancy with right of survivorship. Tony died first in in the current year when the land was worth $3,000,000. What is Rhonda's income tax basis in the property under each of the following assumptions?
(I) Tony and Rhonda are brother and sister.
(II) Tony and Rhonda are husband and wife.
(III) Tony and Rhonda are husband and wife, and the land is community property
2) Copper, an S corporation, has gross receipts of $190,000 and gross income of $170,000. Copper has AEP of $22,000 and ordinary income of $29,000. It has passive investment income of $100,000, with $40,000 of expenses directly related to the production of passive investment income.
(I) What are the requirements to elect S corporation status?
(II) Calculate Copper's excess net passive income.
(III) Calculate the passive investment income penalty tax.
3) At the time of her death in the current year, Julia was a participant in her employer's qualified pension plan. Her accrued balance in the plan is as follows.
Employer's contribution: $1,200,000
Julia's contribution: $700,000
Income earned by plan: $900,000
Julia also was covered by her employer's group term life insurance program. Her policy (maturity value of $200,000) is made payable to Jake (Julia's husband). Jake is also the designated beneficiary of the pension plan.
(I) Regarding these assets, how much is included in Julia's gross estate?
(II) In Julia's taxable estate?
(III) How much income must Jake recognize?
4)Ruth owns a 25% capital and profits interest in the calendar-year RDV Partnership. Her adjusted basis for her partnership interest on July 1 of the current year is $170,000. On that date, she receives a proportionate nonliquidating distribution of the following assets.
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Partnership's Basis in Asset
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Asset's Fair Market Value
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Cash
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$90,000
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$90,000
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Inventory
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$110,000
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$140,000
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Land (held for investment)
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$100,000
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$160,000
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(I) Calculate Ruth's recognized gain or loss on the distribution, if any.
(II) Calculate Ruth's basis in the inventory received.
(III) Calculate Ruth's basis in land received. The land is a capital asset.
(IV) Calculate Ruth's basis for her partnership interest after the distribution.
5) In 2014, Tony and Rhonda acquired land for $600,000, with Tony furnishing $200,000 and Rhonda $400,000 of the purchase price. Title to the property is listed as equal joint tenancy with right of survivorship. Tony died first in in the current year when the land was worth $3,000,000. What is Rhonda's income tax basis in the property under each of the following assumptions?
(I) Tony and Rhonda are brother and sister.
(II) Tony and Rhonda are husband and wife.
(III) Tony and Rhonda are husband and wife, and the land is community property.