I7: 7-34 - Your client, Charley Long, age 40, has requested your advice with respect to his IRA. He has a traditional IRA with a balance of $250,000 and his current AGI is $150,000. He expects his income to increase slightly when he retires at age 65. Charley has been reading about Roth IRAs and wants your advice as to whether he should roll over the $250,000 from his traditional IRA into a Roth IRA. He has sufficient outside money to pay any taxes due on the rollover. What advice would you give Charley?
I8: 8-31 - This year, Chuck took out a loan to purchase some raw land for investment. He paid $40,000 for the land, and he expects that within 5 years the land will be worth at least $75,000. Chuck is married, and his AGI for the year is $230,000. Chuck paid $4,300 in interest on the loan this year. Chuck has $2,600 in interest income and $1,300 in dividend income for the year. He plans to itemize his deductions so he can use the interest expense to offset his investment income. What tax issues should Chuck consider?
I9: 9-35 - Dan, expressing grave concern about whether the company had the financial resources to remain in business. He mentioned specifically that a bank was threatening to force Beta to file bankruptcy if it didn’t repay its $100,000 loan in full. After some negotiation, Dan agreed to loan Beta the $100,000 for one year until permanent financing could be obtained. A reasonable interest rate was set, and a payment schedule was documented. Unfortunately, business did not improve, and Beta discontinued its business and did not repay the loan. What tax issues should Dan consider?