Criteria’s for assignable contracts:
all contract rights are assignable except if involves personal services and those materially increasing the risk of the others
What contracts must be in writing if over $500?
only sale of goods under UCC applies the $500 rule. statue of fraud applies to contracts that cannot be fully performed in 1 yr
If merchant firm offer is made to stay open, will it be enforceable even though it changed of minds?
Yes, a merchant offer (not need for offeree to be merchant) under the UCC rules stays for the period of time stated or reasonable time (up to 3mo.’s most of the time). only qty must be included. warranty of title must be specifically disclaim
Fraud in inducement: void or voidable?
voidable, in the execution will be void
Unilateral contracts
a promise in exchange for performance
dif. of sale w/ reserve or w/o reserve
w/ reserve you can take it back whenever you want, w/o reserve must be sold if an offer is made
if person releases the collateral on a promissory note, who will be liable if non performance?
all that transferred after collateral will be release at same time w/ the collateral
holders in due course applicable defenses
not personal defenses(e. consideration) but applies real defenses(fraud)
are the sell of AR considered as a secured tranx
yes. owing the right to those AR’s (if all then then not considered perfected, if less than 1/2 then can be consider perfected). must file FS in order to perfect an inventory collateral as PMSI
Are partners entitle to compensations?
No. only entitle to profits unless otherwise agreed
Dividend income applies as income?
Yes, for dependent exemptions thus not qualified. Social sec not income thus can qualify as dependent.
Are refunds included as income?
interest on PY refunds are included as income not the actual refund, unless itemized PY and up to deduction used
What value of pty received is consider income?
cash or FMV of pty received is considered the income subject to tax
Are municipal bond int income included in income?
No. they are excluded
When does 25k limit of Mom & Pop applies?
when losses from actively participating. Up to 25k to deduct subject to be lowered by half of the excess of $100k
Are residence insurance deductible when for personal use?
No. interest and pty taxes are deductible
If borrow money w/ home as collateral is it deductible?
Yes up to $100k on mortgage int. if not used to buy, build or home improvement. If done for that reason then mortgage up to $1M are full deduct
How to consider gains from lawsuits due to injury?
deductible(not as income)
Are temporary living and meal expense included as moving expense deduction?
Not anymore. just moving your things, transportation and lodging
How to account for services provided to charity
not allowed as charitable contribution deduction
For what amount will be subject to penalty for not paying estimates?
over $1k will be consider for penalty over the amt outstanding
If estimates are used in preparing an IT return, should it be disclose the use of such estimates in the return?
No need to disclose such info
How much can be deduct from the loss of selling, exchange and unworthiness of stk?
Up to $50k can be deducted but only to original owners
Can tax years be reopen after statute of limitations expires?
Not if considered no fraudulent. For fraud it can be looked at w/o limitations
