CHAPTER 3

Question 1

Compensation for services in whatever from paid, including, but not limited to fees, salaries, wages, commissions, and similar items;

Answer 1

Gross income

Question 2

Gross income derived from the conduct of trade or business or the exercise of a profession;

Answer 2

Gross income

Question 3

Gross income

Answer 3

Gains derived from dealings in property;
Interest;
Rents;
Royalty;Dividends;
Annuities;
Prizes and winnings;
Pensions; and
Partner’s distributive share from the net income of the general professional partnership.

Question 4

Rental income shall be taxable on the year received, whether earning or unearned, provided, there is no restriction as to its use, and regardless of method of accounting employment

Answer 4

Rental payments

Question 5

Security deposit

Answer 5

1) Upon forfeiture in favor of the lessor, or
2) Upon application as rental payment.

Question 6

leasehold improvements
Improvements made by the lessee shall be treated as Income of the lessor. If:

Answer 6

1) The Improvements will be owned by the lessor at the end of the lease;
2) The lessor is not required to pay the lessee the value of such improvements.