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In: Accounting

During 2018, James, a single, cash method taxpayer incurred the following expenditures: Qualified medical expenses                        &n

During 2018, James, a single, cash method taxpayer incurred the following expenditures:

Qualified medical expenses                            $8,000

Investment interest expense                           16,000

Other investment activity expenses                15,000

Qualified residence interest                            12,000

Interest on loan on personal auto                    2,000

Charitable contributions                                 3,000

State income tax paid                                     7,000

State sales tax paid                                         4,500

Property taxes                                                  4,000

Tax return preparation and consulting fees    5,000

James’ income consisted of the following items:

Salary                                                              70,000

Interest income                                               7,000

Long-term capital gains                                 23,000

Long-term capital losses                               15,000  

                       

a. Compute James’ taxable income for the year (assuming that he makes an election to have the net capital gain taxed at the regular tax rates).

b. What is James’ investment interest carryover (if any)?

This is the only information provided:

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ekkarill92 answered 1 year ago
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