For each of the following tax treatments, determine the concept, construct, or doctrine that…

For each of the following tax treatments, determine the
concept, construct, or doctrine that provides the rationale for the treatment:

a. Lester purchases some stock for a total cost of $2,500.
On December 31, 2009, the stock is worth $2,800. In August 2010, he sells the
stock to his brother Rufus for $2,000. Lester has no income from the stock in
2009, and he is not allowed to deduct the $500 loss on the sale of the stock to
Rufus in 2010.

b. Kerry is an employee of Ross Company. During the year,
Ross withholds federal income taxes of $3,500 from her salary. Her tax
liability for the
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For each of the following tax treatments, determine the
concept, construct, or doctrine that provides the rationale for the treatment:

a. Lester purchases some stock for a total cost of $2,500.
On December 31, 2009, the stock is worth $2,800. In August 2010, he sells the
stock to his brother Rufus for $2,000. Lester has no income from the stock in
2009, and he is not allowed to deduct the $500 loss on the sale of the stock to
Rufus in 2010.

b. Kerry is an employee of Ross Company. During the year,
Ross withholds federal income taxes of $3,500 from her salary. Her tax
liability for the year is only $3,200, so she receives a refund of $300.

c. Catherine is a city government employee. She often uses
the city’s photocopier to make personal photocopies and has her secretary type
an occasional personal letter. The value of these services for the current year
is approximately $55 but is not included in Catherine’s gross income.

d. Dante’s allowable personal deductions are only $2,800
this year, so he deducts the standard deduction in computing his taxable
income.

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