Discuss the Fundamentals of Income Tax

Discuss the Fundamentals of Income Tax

1 page, respond the following two questions at lest two paragraph.

Question 1: Robert, a new client of yours, is a self-employed caterer in Santa Fe, New Mexico. Robert drives his personal van when delivering catered meals to customers. You have asked him to provide the amount of business miles driven using his vehicle. You are planning on using the standard mileage method to calculate Robert’s deduction for transportation costs. Robert has responded by saying, “Well, I don’t really keep track of my miles. I guess I drove around 3,000 miles last year for the business.” What would you say to Robert?

Question 2: Your supervisor has asked you to research the following situation concerning Aurora Browning. Aurora is a self-employed attorney practicing in Seattle, Washington. Aurora attended a legal convention that was held on an Alaskan cruise departing from and returning to Seattle, Washington. The cruise ship was a vessel registered in the United States. Aurora’s associated expenses were: Cost of cruise (not including meals) $2,734 Total cost of meals while on the cruise 350 Cost of seminars while on the cruise 500 Total $3,584 Required: Go to the IRS website (www.irs.gov) and locate Publication 463. Review the chapter on Travel. Write a letter to Aurora Browning stating the amount, if any, of travel expenses she can deduct related to the convention cruise. If she is allowed any travel expenses, make sure to include in your letter the substantiation requirements.