Donald Mustard was a decisive gambler, or at last, he gambled a lot. His venue of exquisite was nag racing. He gambled at footprints in Florida and Colorado. He went to the footprint 6 days a week for 48 weeks in 2018. He elapsed a strong sum of term studying racing fashions, programs, and other materials. He absorbed from 60 to 80 hours each week to these gambling-kindred endeavors. He never placed bets on aid of any other individual, or sold tips, or serene commissions for placing bets, or functioned as a bookmaker. He gambled solely for his own representation. He had no other avowal or likeness of avocation. Donald managed to win $120,000 in 2018 from his gambling endeavors. Unfortunately, he also past $121,000. As segregate of his decisive gambling immateriality, Donald incurred different expenses that were promptly kindred to his gambling immateriality:
Expense
Amount
Car expenses
$3,100
Office expense
250
Travel
775
Meals (already at 50%)
1,600
Telephone
700
Subscriptions
1,000
Handicapping data
2,000
Total
$9,425
The sums and the trodden interdependence to his gambling affair at not in scrutiny.
Donald is apprised that there is some order of government about limiting wagering losses to wagering gains but he is hoping that his other affair expenses are deductible on his Schedule C.
Your Assignment:
Prepare a tax investigation memo addressed to the files that explains what Donald’s tax citationure of his gambling losses and affair expenses is?
You conciliate need to help your falsification using important sources of tax law. Your citationbook is NOT important antecedent. You may investigation ANY tax antecedent (important or resultant) but your disentanglement must be acquired and helped using barely important antecedent.
You must use special quotation fashion in your memo (see Exhibit 2-5 in Chapter 2 of your citationbook). The fashion for this message should be decisive and in the fashion of a tax investigation memo (see sample on p.2-20).
This memo should be whatever diffusiveness you move is misapportion to direct the issues. We do NOT use a bibliography or catalogue of relations in a tax investigation memo. You conciliate see that quotations are amid the citation of the instrument.
Your memo conciliate be graded using a mitigated account of the College of Affair Administration’s written messages rubric (posted in Blackboard). For this assignment, points are as sorted as follows:
Content 15
Organization 3
Audience 3
Style 3
Mechanics 3
References 3
Total 30
Content conciliate be mild down into 3 components: (1) Facts, (2) Anatomy and (3) Conclusion.
Component
Exceeds Expectations
Unacceptable
Content - Facts
All pertinent basis bear been picturesque in a manifest and succinct style. Distinguishing features of the truth sample are highlighted.
Critical basis omitted. Untelling to apportion or distinguish from other feasible truth samples or basis are barely copied from occurrence.
Content - Analysis
All necessary relations to antecedent bear been made. Antecedent which could apportion but does not has been famous from that which does. The anatomy follows a close sample of impression to the basis and supports author’s falsification.
Analysis is short in relation to decisive tax law. Anatomy lacks cohesion and does not help falsification.
Content-Conclusion
Conclusion is manifest and integrates after a while basis and anatomy. More than a humble decision stating conclusion. Cause and commodities interdependence between basis and anatomy are made. All public issues are responded to. Conclusion drawn is rectify.
Conclusion is unmanifest and unbefriended by anatomy. Reader is not telling to fashion educated view on tax citationure of basis pattern.
