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Federal Taxations Week 2 Lecture 1
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This lesson is concerned with the first step in the computation of taxable income – the determination of gross income. Questions that are addressed include the following: What: What is income? When: In which tax period is the income recognized? And Who: Who must include the item of income in gross income? Next Slide:    

3.               After completing this lesson, you should be able to: Explain the concepts of gross income and realization and distinguish between the economic, accounting, and tax concepts of gross income. Describe the cash and accrual methods of accounting and the related effects of the choice of taxable year. Identify who should pay the tax on a particular item of income in various situations, and  Apply the Internal Revenue Code provisions on alimony, loans made at below-market interest rates, annuities, prizes and awards, group term life insurances, unemployment compensation, and Social Security benefits. Next Slide:        

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