For Each Tax Treatment Described Below, Indicate Which Tax Concepts)

question 39

Essay

For each tax treatment described below, indicate which tax concepts) that is are) responsible for the treatment. Kimberly, an accrual basis taxpayer, validly took a bad debt deduction of $850 in 2013 for
a. an account receivable due from Cathy. In 2014, Cathy sent Kimberly a check for $500.
Kimberly must include the $500 in her 2014 taxable income.
Randall, a cash basis taxpayer, receives $1,400 from Craig in December 2014. The $1,800
b. was for payment of the first and last month's rent $700 per month) and a $400 cleaning deposit on a building Craig rented from Randall. Randall includes $1,400 in his 2014 taxable
income.
c. Matt pays $14,000 rent on the office he uses in his computing firm. Matt is allowed to deduct the $14,000 on his tax return.
d. Samantha sells stock for $9,000 that she purchased two years earlier for $8,000. Samantha must report a capital gain of $1,000 on the sale.
Rosanne sells jewelry and some old clothes during the year. The jewelry cost $750 and is
e. sold for $800. The clothes cost $500 and are sold for $150. Rosanne must include the $50 gain on the sale of her jewelry in her taxable income, but is not allowed to deduct the loss.

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Definitions:

Sartre

Jean-Paul Sartre, a French existentialist philosopher, playwright, novelist, and political activist known for his explorations of freedom and existentialism.

Extreme Circumstances

Situations that are highly unusual or exceptional, often involving severe stress or urgency.

Negatively Free

A condition where freedom is defined by the absence of external constraints or limitations on one's actions, as opposed to being enabled to pursue certain goals (positive freedom).

Kant

Immanuel Kant was an 18th-century German philosopher who made significant contributions to metaphysics, epistemology, ethics, and aesthetics, notably known for his work "Critique of Pure Reason."