Federal Income Tax: Examples and Explanations

by Bankman, Joseph; Griffith, T. D.; Pratt, Katherine

• ISBN13: 9780735524026
• ISBN10: 0735524025
• Edition: 3rd
• Format: Paperback
• Copyright: 2002-07-01
• Publisher: Wolters Kluwer

Summary

This comprehensive study guide explores and explains Federal Income Tax law to help students achieve a thorough understanding of this essential area. Highly regarded by instructors and successfully used by thousands of students, Federal Income Taxation: Examples & Explanations enters its Third Edition with a reputation for quality and effectivneess. the book earned its loyal users through: the Examples & Explanations style, combining clear text with examples, explanations, and questions to test student understanding of the material comprehensive coverage of all important topics in Federal Income Tax Taxation inclusion of numerous policy questions throughout text skillful organization that facilitates successful use alongside any of the leading casebooks breaking complex subjects into discrete questions for easier understanding offering sample exams -- with answers illustrating concepts through charts, figures, and graphics New material in the Third Edition includes: coverage of the Economic Growth and Tax Relief Reconcilation Act of 2001 changes in the tax law since 1999 coverage of Tax Shelters new examples and explanations new sample exams

Table of Contents

An Introductory Note to Students	xiii
Acknowledgments	xv
Introduction	1	(32)
Introduction to Terminology and Structure	2	(11)
Time Value of Money and the Value of Deferring Tax	13	(5)
Tax Administration and Litigation	18	(6)
Tax Legislation	24	(2)
Tax Research	26	(7)
Some Characteristics of Gross Income	33	(92)
The Haig-Simons Definition of Income	34	(1)
Noncash Compensation: Fringe Benefits	35	(26)
Employer-Provided Meals and Lodging	35	(8)
Employer-Provided Insurance and Health, Accident, and Death Benefits	43	(3)
The Section 132 Exclusion for Miscellaneous Fringe Benefits	46	(15)
Imputed Income	61	(4)
Windfalls, Gifts, Scholarships, Prizes, and Transfer Payments	65	(13)
Windfalls	65	(1)
Gifts and Bequests	66	(9)
Scholarships, Prizes, and Awards	75	(2)
Transfer Payments	77	(1)
Selected Recovery of Capital Issues: Partial Sales, Annuities, Insurance Policies, Life Estates, and Remainder Interests	78	(17)
Partial Sales	79	(2)
Annuities	81	(8)
Life Insurance	89	(3)
Gambling Winnings and Losses	92	(1)
Life Estates and Remainder Interests	93	(2)
Annual Accounting	95	(6)
Personal Injury Recoveries	101	(11)
Transactions Involving Loans and Income from Discharge of Indebtedness	112	(9)
Tax-Exempt Bonds	121	(1)
Gain from the Sale of a Personal Residence	122	(3)
Problems of Timing	125	(72)
Gains and Losses from Investment in Property	126	(16)
Realization of Gains and Losses	126	(2)
Recognition of Gains and Losses	128	(1)
Like-Kind Exchanges	128	(10)
Other Nonrecognition Rules	138	(4)
Transfers Incident to Marriage and Divorce	142	(9)
Installment Sale and Open Transaction Reporting	151	(6)
Original Issue Discount	157	(9)
The Cash Method of Accounting	166	(7)
Section 83 Transfers	173	(10)
The Accrual Method of Accounting	183	(7)
Alternative Tax Bases: Consumption Tax and Value Added Tax	190	(7)
Personal Deductions, Exemptions, and Credits	197	(54)
Introduction	197	(8)
Casualty Losses	205	(10)
Extraordinary Medical Expenses	215	(10)
Charitable Contributions	225	(15)
Personal Interest	240	(7)
Taxes	247	(4)
Deductions for the Costs of Earning Income	251	(120)
The Statutory Framework	252	(2)
Current Expenses versus Capital Expenditures	254	(9)
Repair and Maintenance Expenses	263	(3)
Inventory Accounting	266	(12)
Rent Payments versus Installment Purchase	278	(4)
Goodwill and Other Intangible Assets	282	(3)
``Ordinary and Necessary'' Expenses	285	(7)
The Scope of ``Ordinary and Necessary''	285	(2)
Reasonable Compensation	287	(3)
Costs Associated with Illegal or Unethical Activities	290	(2)
Depreciation and the Accelerated Cost Recovery System	292	(19)
Depletion Deductions	311	(2)
Tax Shelters	313	(58)
The Characteristics of Tax Shelters	313	(2)
The Judicial Response to Tax Shelters	315	(9)
The Congressional Response to Tax Shelters	324	(1)
The Investment Interest Limitation of §163(d)	324	(5)
The Passive Loss Rules of §469	329	(13)
The At-Risk Rules of §465	342	(7)
The Limitations of §§264 and 265	349	(3)
The Accuracy-Related Penalties of §6662	352	(1)
Sale and Leaseback Transactions	352	(8)
Alternative Minimum Tax	360	(2)
Additional Review Examples	362	(3)
Corporate Tax Shelters	365	(6)
Mixed Personal and Business Expenditures	371	(62)
Controlling the Abuse of Business Deductions	372	(23)
Hobby Losses	372	(8)
Rental of a Dwelling Used by the Taxpayer	380	(8)
Home Offices, Computers, and Automobiles	388	(7)
Travel and Entertainment Expenses	395	(9)
Child Care Expenses	404	(5)
Commuting Expenses	409	(4)
Clothing Expenses	413	(2)
Legal Expenses	415	(3)
Educational Expenses	418	(15)
Income Shifting	433	(32)
Income from Services and Property	433	(13)
Trusts	446	(4)
Grantor Trusts	450	(5)
Family Partnerships	455	(4)
Below-Market Loans	459	(6)
Capital Gains and Losses	465	(46)
The Tax Treatment of Capital Gains and Losses	465	(10)
Policy Rationale for the Treatment of Capital Gain and Loss	475	(3)
The Definition of ``Capital Asset''	478	(14)
Section 1231 and Depreciation Recapture	492	(6)
Substitutes for Ordinary Income	498	(7)
The Sale of a Business	505	(5)
Connected Current and Prior Transactions	510	(1)
Exam Appendix	511	(92)
Table of Cases	603	(4)
Table of Internal Revenue Code Sections	607	(10)
Table of Treasury Regulations	617	(2)
Table of Other Administrative Pronouncements	619	(2)
Topical Index	621