Question

"Mason Phillips, age 45, and his wife, Ruth, live at 230 Wood Lane, Salt Lake City, UT 84101. Mason’s Social Security number is 111-11-1111. Ruth’s Social Security number is 123-45-6789. Mason and Ruth are cash basis taxpayers and had the following items for 2020:

•             Salary of $140,000.

•             Bad debt of $30,000 from uncollected rent."

"             Collection of unpaid rent from a prior year "

"Sale of § 1244 stock resulting in a loss of $105,000. The stock was acquired eight months ago.

•             Rental income of $60,000 (property is managed by Mason and Ruth).

•             Rental expenses of $33,000.

•             Casualty loss on rental property of $10,000.

•             Personal casualty loss (from one event) of $3,000; not in a Federally declared disaster area.

•             Theft loss of $8,000 on a painting held for investment.

•             Other itemized deductions of $21,000.• Federal income tax withheld of $3,000"

"Compute Mason and Ruth’s 2020 Federal income "

Answer 1

"Mason Phillips, age 45, and his wife, Ruth, live at 230 Wood Lane, Salt Lake City, UT 84101. Mason’s Social Security number is 111-11-1111.