Tax Analysis

I decided that Betsy and Ronald should move closer to Ronald's place of employment, as Betsy is self employed and can deduct her travel when she needs to travel. Ronald's company will not pay travel expenses for him to get to and from work. But Betsy can charge travel and deduct her travel expenses in her status of self employment. In order to deduct her travel, Betsy must keep records of travel time and exact mileage. So the best choice for housing for Betsy and Ronald is for them to move closer to Ronald's place of employment.

The best option for Betsy between buying a vehicle and leasing, is to lease a new vehicle. Because this vehicle is primarily for business use, Betsy will be able to write off expenses of the vehicle. Leasing is a better option of a business vehicle. As for a car versus an SUV, a car would be a cheaper option for Betsy. The other benefit to a car is better gas mileage. I think that a car would have been a better business option for Betsy. A car is cheaper in book value to begin with. A car will get better gas mileage than a SUV, which would save Betsy money is gas prices.

The forth simulation was regarding real estate sales. Kevin was trying to decide the best way to invest his money in order to get the best return on his investment. It was determined that the best basis for depreciation for Kevin's house was the adjusted in his house. It was determined that it would be best for Kevin to sell his shares in Techno Biotic stock now. It would also be best for Kevin to wait until March to sell his stock in M2Zion. This would give Kevin the best return on his capital gains tax. Because Kevin did not use this house as his primary residence for two years in the past five years, he does not qualify for the exclusion on capital gains. Because Kevin moved due to the ill health of his father, he can claim a reduced exclusion amount. He does