Question

# -Masoud’s records reflect the following information: 1. Paid \$400 dues to a fraternal organization (such as...

-Masoud’s records reflect the following information:

1. Paid \$400 dues to a fraternal organization (such as the Elks Club).

2. Donated stock having a fair market value of \$5,000 to a qualified charitable organization. He purchased the stock 3 years earlier for \$2,500.

3. Paid \$1,500 cash to qualified public charitable organizations.

Masoud's adjusted gross income for this year was \$50,000. What is the amount of his charitable contribution deduction for the year?

A) \$2,500

B) \$4,000

C) \$5,000

D) \$6,500

-Chan reports the following income and loss:

 Salary \$ 100,000 Income from activity A 75,000 Loss from activity B ( 40,000) Loss from activity C ( 60,000)

Activities A, B, and C are all passive activities.

Based on this information, Chan has the following suspended losses

A)

 Activity B Activity C \$40,000 \$60,000

B)

 Activity B Activity C \$0 \$0

C)

 Activity B Activity C \$10,000 \$15,000

D)

 Activity B Activity C \$12,000 \$28,000

-Diego has AGI of \$125,000 before considering his \$50,000 loss from rental property, which he actively manages. How much of the rental loss can Anthony deduct this year?

A) \$10,000

B) \$12,500

C) \$25,000

D) \$40,000

1. Answer is option D \$6,500

Donated stock having a fair market value of \$5,000 to a qualified charitable organization + Paid \$1,500 cash to qualified public charitable organizations = 6500

2. Answer is option C

Total passive loss of 25000 (75000-40000-60000) distributed in the ratio of 2:3

3. Answer is option B

Excess over threshold = \$125,000 - \$100,000 = \$25,000

\$25,000 x 50% = \$12,500

Actual loss of \$50000 is greater than \$12,500 limit thus 12500 rental loss will be deducted.

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