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This year Sam purchased 500 shares of Staples common stock for $20 per share. According to...

This year Sam purchased 500 shares of Staples common stock for $20 per share. According to his statement at the year-end, the shares (were not sold) were only worth $2 per share. What amount can he deduct as a loss this year?

   A.  
$10,000

    B.  
$3,000

    C.  
$9,000

    D.  
$0

    E.  
$1,000

Doug, a single taxpayer, has $150,000 of profits from his web designing business that he operates as a sole proprietorship. He has no employees, $40,000 of qualified property, and $60,000 of taxable income before the deduction for qualified business income. How much is his deduction for qualified business income (QBI)?

   A.  
$30,000

    B.  
$150,000.

    C.  
$40,000.

    D.  
$10,000.

    E.  
$12,000.

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Answer #1

What amount can he deducat as a loss this year?

Ans: $0

( loss camd be deducted only when stocks are actully sold. here shares were not sold so loss would be $0)

How much is his deduction for qualified business income (QBI)?

Ans: E ( $12,000)

Explanation:

Deduction For qualified business income is limited to 20% of taxable income before the deduction.

She is not subject to wage limit as her income falls below the $ 157500 thereshold.

Deduction for qualified business income (QBI):

= $ 60,000 × 20%

=$ 12,000

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