Compute Nancy and Steve adjusted gross income

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Problem - Nancy is married and ?le a joint tax return with her husband Steven. For tax year ending December 31, 2019 they reported the following items:

Salary $195,000

§ 1244 loss on stock acquired 3 years ago $115,000

§ 1244 gain on stock acquired 10 months ago $9,000

Short-term capital loss purchased last year $14,000

Personal loan to friend that became uncollectible due to friend's untimely death $12,000

Interest income $8,000

Stock Dividend (FMV on date of Dividend) $25,000

Required -

a. Compute Nancy and Steve's adjusted gross income for 2019.

b. Explain the reason for excluding any item from adjusted gross income.

Reference no: EM132944048

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