Question 1

Tax credits are dollar-for-dollar reductions in taxable income.

Accepted Answer

A) True 
 B)False  True

Question 2

George,from the previous problem,is single and his standard deduction for the year is $5,450.If he is in the 25% marginal tax bracket,how much tax would he save by using his itemized deductions?

Accepted Answer

($12,600 - 5,450)* .25 = $1,787.50

Question 3

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-Interest you paid on your [car | house] loan could be deducted.

Accepted Answer

b

Question 4

George has the following expenses that he wants to include as itemized deductions for the year.His adjusted gross income is $60,000.What is the total itemized deduction he can take? (Show all work. )

Accepted Answer

The answer of George has the following expenses that he...

Question 5

____ income is subject to federal taxes.

Accepted Answer

A)  Gross 
B)  Adjusted gross 
C)  Net 
D)  Take-home 
E)  Taxable 
A)  Gross 
B)  Adjusted gross 
C)  Net 
D)  Take-home 
E)  Taxable

Question 6

Itemized deductions could include certain taxes,medical expenditures,and home mortgage interest.

Accepted Answer

A) True 
 B)False

Question 7

Jamil and Vicki have one child,age 3,for which they paid $2,500 in child care expenses this year.If they are eligible for the 20% dependent care credit plus the child tax credit,how much will these two credits reduce their tax liability?

Accepted Answer

A)  $ 500 
B)  $1,500 
C)  $2,000 
D)  $2,500 
E)  $3,000 
A)  $ 500 
B)  $1,500 
C)  $2,000 
D)  $2,500 
E)  $3,000

Question 8

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-Your income tax filing status is determined primarily by your [income | marital] status.

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Question 9

Which of the following offer tax preparation services?

Accepted Answer

A)  National and local tax services 
B)  Certified Public Accountants (CPAs) 
C)  Enrolled Agents (EAs) 
D)  Tax Attorneys 
E)  All of the above can offer tax preparation services 
A)  National and local tax services 
B)  Certified Public Accountants (CPAs) 
C)  Enrolled Agents (EAs) 
D)  Tax Attorneys 
E)  All of the above can offer tax preparation services

Question 10

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-The main objective of tax planning is to maximize the amount of money you keep by minimizing the amount of taxes you pay.

Accepted Answer

A) True 
 B)False

Question 11

The Robertsons,a couple with an AGI of $28,500,decided to contribute the maximum amount possible towards their IRAs even though Mr.Robertson had a pension plan at work.He named his wife as beneficiary of the IRA.What is such a tax strategy called?

Accepted Answer

A)  tax deferral since he'll have to pay taxes later when he withdraws the money 
B)  tax avoidance since he'll never have to pay taxes on the IRA contribution 
C)  tax evasion since this is illegal 
D)  tax ignorance since he can't deduct the contribution anyway due to his pension plan at work 
E)  income shifting to another person in a lower tax bracket 
A)  tax deferral since he'll have to pay taxes later when he withdraws the money 
B)  tax avoidance since he'll never have to pay taxes on the IRA contribution 
C)  tax evasion since this is illegal 
D)  tax ignorance since he can't deduct the contribution anyway due to his pension plan at work 
E)  income shifting to another person in a lower tax bracket

Question 12

Itemized non-business expenses do not include

Accepted Answer

A)  charitable contributions. 
B)  state income taxes. 
C)  residential mortgage interest. 
D)  medical expenses. 
E)  life insurance premiums. 
A)  charitable contributions. 
B)  state income taxes. 
C)  residential mortgage interest. 
D)  medical expenses. 
E)  life insurance premiums.

Question 13

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-Your taxable income is $160,000.You will determine your tax liability by using the tax [tables | schedules].

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Question 14

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-Portfolio-related expenses can be written off against passive income.

Accepted Answer

A) True 
 B)False

Question 15

Pete and Pam are married with four dependent children.Pete and Pam can legally file using which of the following filing statuses?

Accepted Answer

A)  married filing separately 
B)  married filing jointly 
C)  head of household 
D)  a and b 
E)  a,b,and c 
A)  married filing separately 
B)  married filing jointly 
C)  head of household 
D)  a and b 
E)  a,b,and c

Question 16

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-The highest marginal tax rate is currently [35% | 28%].

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Question 17

The current FICA withholding rate is

Accepted Answer

A)  6.0%. 
B)  6.75%. 
C)  7.25%. 
D)  7.5%. 
E)  7.65%. 
A)  6.0%. 
B)  6.75%. 
C)  7.25%. 
D)  7.5%. 
E)  7.65%.

Question 18

Tax practitioners that are Federally licensed are called

Accepted Answer

A)  Certified Public Accountants 
B)  Certified Financial Planners 
C)  Tax Attorneys 
D)  Enrolled Agents 
E)  None of the above 
A)  Certified Public Accountants 
B)  Certified Financial Planners 
C)  Tax Attorneys 
D)  Enrolled Agents 
E)  None of the above

Question 19

A tax audit is a(n)

Accepted Answer

A)  IRS revision of previously filed return. 
B)  IRS attempt to verify accuracy of return. 
C)  IRS charge of illegal action. 
D)  U.S.Tax Court action. 
E)  U.S.Tax Court decision. 
A)  IRS revision of previously filed return. 
B)  IRS attempt to verify accuracy of return. 
C)  IRS charge of illegal action. 
D)  U.S.Tax Court action. 
E)  U.S.Tax Court decision.

Question 20

The federal income tax is

Accepted Answer

A)  integrative. 
B)  regressive. 
C)  progressive. 
D)  flat rate. 
E)  none of the above. 
A)  integrative. 
B)  regressive. 
C)  progressive. 
D)  flat rate. 
E)  none of the above.

Tax credits are dollar-for-dollar reductions in taxable income.

George,from the previous problem,is single and his standard deduction for the year is $5,450.If he is in the 25% marginal tax bracket,how much tax would he save by using his itemized deductions?

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -Interest you paid on your [car | house] loan could be deducted.

George has the following expenses that he wants to include as itemized deductions for the year.His adjusted gross income is $60,000.What is the total itemized deduction he can take? (Show all work. )

____ income is subject to federal taxes.

Itemized deductions could include certain taxes,medical expenditures,and home mortgage interest.

Jamil and Vicki have one child,age 3,for which they paid $2,500 in child care expenses this year.If they are eligible for the 20% dependent care credit plus the child tax credit,how much will these two credits reduce their tax liability?

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -Your income tax filing status is determined primarily by your [income | marital] status.

Which of the following offer tax preparation services?

The Robertsons,a couple with an AGI of $28,500,decided to contribute the maximum amount possible towards their IRAs even though Mr.Robertson had a pension plan at work.He named his wife as beneficiary of the IRA.What is such a tax strategy called?

Itemized non-business expenses do not include

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -Portfolio-related expenses can be written off against passive income.

Pete and Pam are married with four dependent children.Pete and Pam can legally file using which of the following filing statuses?

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -The highest marginal tax rate is currently [35% | 28%].

The current FICA withholding rate is

Tax practitioners that are Federally licensed are called

A tax audit is a(n)

The federal income tax is

Understanding the Financial Planning Process

Your Financial Statements and Plans

Managing Your Cash and Savings

Making Automobile and Housing Decisions

Using Credit

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds

Planning for Retirement

Preserving Your Estate

Filters

Exam 3: Preparing Your Taxes

Tax credits are dollar-for-dollar reductions in taxable income.

George,from the previous problem,is single and his standard deduction for the year is $5,450.If he is in the 25% marginal tax bracket,how much tax would he save by using his itemized deductions?

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -Interest you paid on your [car | house] loan could be deducted.

George has the following expenses that he wants to include as itemized deductions for the year.His adjusted gross income is $60,000.What is the total itemized deduction he can take? (Show all work. )

____ income is subject to federal taxes.

Itemized deductions could include certain taxes,medical expenditures,and home mortgage interest.

Jamil and Vicki have one child,age 3,for which they paid $2,500 in child care expenses this year.If they are eligible for the 20% dependent care credit plus the child tax credit,how much will these two credits reduce their tax liability?

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -Your income tax filing status is determined primarily by your [income | marital] status.

Which of the following offer tax preparation services?

The Robertsons,a couple with an AGI of $28,500,decided to contribute the maximum amount possible towards their IRAs even though Mr.Robertson had a pension plan at work.He named his wife as beneficiary of the IRA.What is such a tax strategy called?

Itemized non-business expenses do not include

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -Portfolio-related expenses can be written off against passive income.

Pete and Pam are married with four dependent children.Pete and Pam can legally file using which of the following filing statuses?

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -The highest marginal tax rate is currently [35% | 28%].

The current FICA withholding rate is

Tax practitioners that are Federally licensed are called

A tax audit is a(n)

The federal income tax is

Understanding the Financial Planning Process

Your Financial Statements and Plans

Managing Your Cash and Savings

Making Automobile and Housing Decisions

Using Credit

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds

Planning for Retirement

Preserving Your Estate

Filters