Nitai, who is single and has no dependents, was planning on spending the weekend repairing his car. On Friday, Nitai’s employer called and offered him $300 in overtime pay if he would agree to work over the weekend. Nitai could get his car repaired over the weekend at Autofix for $240. If Nitai works over the weekend, he will have to pay the $240 to have his car repaired but he will earn $300. Assume Nitai pays tax at a flat 12 percent rate. (Do not round intermediate calculations. Round your answers to 2 decimal places.) a-1. Strictly considering tax factors, should Nitai work or repair his car if the $240 he must pay to have his car fixed is not deductible? multiple choice Work Repair a-2. Given the answer in a-1 above, by how much is Nitai better or worse off?

Nitai, who is single and has no dependents, was planning on spending the weekend repairing his car. On Friday, Nitai’s employer called and offered him $300 in overtime pay if he would agree to work over the weekend. Nitai could get his car repaired over the weekend at Autofix for $240. If Nitai works over the weekend, he will have to pay the $240 to have his car repaired but he will earn $300. Assume Nitai pays tax at a flat 12 percent rate. (Do not round intermediate calculations. Round your answers to 2 decimal places.) a-1. Strictly considering tax factors, should Nitai work or repair his car if the $240 he must pay to have his car fixed is not deductible? multiple choice Work Repair a-2. Given the answer in a-1 above, by how much is Nitai better or worse off?

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter5: Introduction To Business Expenses

Section: Chapter Questions

Problem 56P: Hassad owns a rental house on Lake Tahoe. He uses a real estate firm to screen prospective renters,...

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Hassad owns a rental house on Lake Tahoe. He uses a real estate firm to screen prospective renters, but he makes the final decision on all rentals. He also is responsible for setting the weekly rental price of the house. During the current year, the house rents for 1,500 per week. Hassad pays a commission of 150 and a cleaning fee of 75 for each week the property is rented. During the current year, he incurs the following additional expenses related to the property: a. What is the proper tax treatment if Hassad rents the house for only 1 week (7 days) and uses it 50 days for personal purposes? b. What is the proper tax treatment if Hassad rents the house for 8 weeks (56 days) and uses it 44 days for personal purposes? c. What is the proper tax treatment if Hassad rents the house for 25 weeks (175 days) and uses it 15 days for personal purposes?
Nitai, who is single and has no dependents, was planning on spending the weekend repairing his car. On Friday, Nitai’s employer called and offered him $300 in overtime pay if he would agree to work over the weekend. Nitai could get his car repaired over the weekend at Autofix for $240. If Nitai works over the weekend, he will have to pay the $240 to have his car repaired but he will earn $300. Assume Nitai pays tax at a flat 12 percent rate. (Do not round intermediate calculations. Round your answers to 2 decimal places.) b-1. Strictly considering tax factors, should Nitai work or repair his car if the $240 he must pay to have his car fixed is deductible for AGI? multiple choice Work Repair b-2. Given the answer in b-1 above, by how much is Nitai better or worse off?
Nitai, who is single and has no dependents, was planning on spending the weekend repairing his car. On Friday, Nitai's employer called and offered him $500 in overtime pay if he would agree to work over the weekend. Nitai could get his car repaired over the weekend at Autofix for $400. If Nitai works over the weekend, he will have to pay the $400 to have his car repaired, but he will earn $500. Assume Nitai's marginal tax rate is 12 percent rate. Required: a-1. Strictly considering tax factors, should Nitai work or repair his car if the $400 he must pay to have his car fixed is not deductible? a-2. Given the answer in a-1 above, by how much is Nitai better or worse off? b-1. Strictly considering tax factors, should Nitai work or repair his car if the $400 he must pay to have his car fixed is deductible for AGI? b-2. Given the answer in b-1 above, by how much is Nitai better or worse off?
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