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Background:

Hello, my name is Shady Slim. I understand that you are going to help me figure out my gross income for the year, whatever that means. It's been a

busy year and I$\text{'}$m a busy man, so let me give you the lowdown on my life, and you can do your thing.

I was unemployed at the beginning of the year and got $$2,000$ in unemployment compensation. I later got a job as a manager for Roca Cola. I

earned $$55,000$ in base salary this year. My boss gave me a $$5,000$ Christmas bonus on December $22,$ but I decided to hold on to that check and

not cash it until next year so that I won't have to pay taxes on it this year. Pretty smart, huh?

As part of my manager duties, I get to decide on certain things, like contracts, for the company. My good buddy, Eddie, runs a bottling company. I

made sure that he won the bottling contract for Roca Cola for this year $($even though his contract wasn't quite the best$).$ Eddie bought me a

Corvette this year for being such a good friend. It Corvette cost $$50,000,$ and I$\text{'}$m sure he bought it for me out of the goodness of his heart. What a

great guy!

Here's a bit of good luck for the year: Upon leaving my office one day, I found $$8,000$ lying in the street! Well, one person's bad luck is my good

luck, right? I like to gamble a lot. I won a $$220,000$ poker tournament in Las Vegas this year. I also won about $$5,000$ over the year playing the

guys at our Friday night game. Can you believe that I didn't lose anything this year?

Speaking of the guys, one of them said that I should put that money I won at gambling$-$well, $$200,000$ of it$-$into an annuity? So I did just that,

and now I'll get $$1,000$ a month for the next $20$ years. I already got $$3,000$ of it$!$ Please tell me none of that is taxable!

My ex$-$wife, Alice, is still paying me alimony. She's a lawyer who divorced me a few years ago because I was "unethical," or something like that.

Since she was making so much money and I was unemployed at the time, the judge ruled that she had to pay me alimony. Isn't that something? She

sent me $$3,000$ in alimony payments this year. She still kind of likes me$,$ though; she sent me a check for $$500$ as a Christmas gift this year. $($I didn't

get her anything, though.$)$

So$,$ there you go$...$that's this year in a nutshell.

Can you figure out my gross income? And since you're a student, this is free, right? Thanks, I owe you one! Let me know if I can get you a six$-$pack

of Roca Cola or something.

Task:

You must cite all relevant tax code to determine what items would be included or excluded from gross income. Prepare your response in a tax

memo format. Any reference to "this year" is the current tax year you are advising in$.$

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