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Tax Drill - Original Issue Discount On January...

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Accounting

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Tax Drill - Original Issue Discount On January 1, 2020, Kunto, a cash basis taxpayer, pays $46,228 for a 24-month certificate. The certificate is priced to yield 4% (the effective interest rate) with interest compounded annually. No interest is paid until maturity, when Kunto receives $50,000. In your computations, round any amounts to the nearest dollar Kunto has s 1,849.12 X income for 2020 and 192,288 X for 2021. Feedback Myrna and Geoffrey filed a joint tax return in 2019. Their AGI was $85,000, and itemized deductions were $25,100, which included $7,000 in state income tax. In 2020, they received a $1,800 refund of the state income taxes that they paid in 2019. The standard deduction for married filing jointly in 2019 was $24,400. Under the tax benefit rule, 0 X of the state income tax refund is included in gross income in 2020. Freither

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