Question 1

Qualified dividends are given special tax treatment.Describe how they are taxed.

Accepted Answer

Qualified dividends are taxed at 0 perce

Question 2

Nicole is a student at USB Law;she receives a $52,000 scholarship for 2013.Of the $52,000,$40,000 is used for tuition,$5,000 is used for books,and $7,000 is used for room and board.How much of the scholarship is taxable income for Nicole in 2013?

Accepted Answer

A) $52,000 
B) $40,000 
C) $45,000 
D) $7,000 
E) $12,000 
A) $52,000 
B) $40,000 
C) $45,000 
D) $7,000 
E) $12,000

Question 3

Richard and Alice are divorced and under the terms of their written divorce agreement signed on December 30,2006,Richard was required to pay Alice $1,500 per month of which $600 was designated as child support.He made 12 such payments in 2013.Additionally,Richard voluntarily paid Alice $1,200 per month for 12 months of 2013,no portion of which was designated as child support.Assuming that Alice has no other income,her tax return for 2013 should show gross income of:

Accepted Answer

A) $0 
B) $10,800 
C) $18,000 
D) $25,200 
E) None of the above 
A) $0 
B) $10,800 
C) $18,000 
D) $25,200 
E) None of the above

Question 4

Answer the following questions regarding the taxability of Social Security payments.
a.Will a taxpayer with no income other than Social Security have to include the Social Security in taxable income?
b.Will a taxpayer with a large amount of municipal bond income,but no taxable income,likely have to pay tax on part of his or her Social Security?
c.What is the maximum percentage of Social Security benefits which may be subject to tax on an individual's tax return?

Accepted Answer

a.No.The taxpayer's income is below the

Question 5

Andy landscaped his friend's house in return for a couch set and an HD television worth $8,000.How much income must Andy report on his tax return for his services?

Accepted Answer

The noncash payment of $8,000 for servic

Question 6

Disability benefits are generally taxable to the individual receiving the amounts.

Accepted Answer

A) True 
 B)False

Question 7

A "no-additional-cost" service includes only those services in the major line of business in which the employee is employed.

Accepted Answer

A) True 
 B)False

Question 8

Seymore named his wife,Penelope,the beneficiary of a $100,000 insurance policy on his life.The policy provided that,upon his death,the proceeds would be paid at a rate of $4,000 per year plus interest over a 25-year period.Seymore died June 25,2012,and in 2013 Penelope received a payment of $5,200 from the insurance company.What amount should she include in her gross income for 2013?

Accepted Answer

A) $200 
B) $1,200 
C) $4,000 
D) $5,200 
E) None of the above 
A) $200 
B) $1,200 
C) $4,000 
D) $5,200 
E) None of the above

Question 9

If a life insurance policy is transferred to the insured's partnership for valuable consideration,the insurance proceeds are taxable when received by the partnership.

Accepted Answer

A) True 
 B)False

Question 10

Mary received the following items during 2013: Christmas bonus from her employer $\$ 500$
Christmas gift from her father $\quad \quad \quad \$35$
Prize won in a radio show contest $\quad \$ 100$ What is the total amount of the above items that must be included in Mary's 2013 gross income?

Accepted Answer

A) $0 
B) $100 
C) $500 
D) $600 
E) $635 
A) $0 
B) $100 
C) $500 
D) $600 
E) $635

Question 11

Interest income received by a cash basis taxpayer is generally reported in the tax year it is received.

Accepted Answer

A) True 
 B)False

Question 12

As part of the property settlement related to their divorce,Stella must give Peter the house that they have been living in,while she gets 100 percent of their savings accounts.The house was purchased in Texas 15 years ago for $100,000 and is now worth $110,000.How much gain must Stella recognize on the transfer of the house to Peter? What is Peter's tax basis in the house for calculating any future sale of the house?

Accepted Answer

No gain is taxable to Stella on the tran

Question 13

A taxpayer in the 28 percent tax bracket invests in a City of San Diego bond paying 8 percent interest.What taxable interest rate would provide the same after-tax return?

Accepted Answer

11.11 perc

Question 14

Karina receives a scholarship of $10,000 to a college.She is also given a job which pays $5,000 a year to help with her expenses.$7,000 of the scholarship is earmarked for tuition and $3,000 is for room and board.How much of the money from the scholarship and the job are taxable to Karina?

Accepted Answer

The $5,000 earnings from the job are tax

Question 15

Cash allowances for meals or lodging generally must be included in the employee's income.

Accepted Answer

A) True 
 B)False

Question 16

If a divorce agreement executed in 2013 specifies that a portion of the amount of an alimony payment is contingent upon the status of a child,that portion is considered to be a child support payment.

Accepted Answer

A) True 
 B)False

Question 17

Child support payments are deductible by the spouse making the payments.

Accepted Answer

A) True 
 B)False

Question 18

Elmore receives a rental property as an inheritance from his grandmother.The rental is worth $500,000 and Elmore collected rental income of $24,000 during the year.
For the year,how much is Elmore's gross income as a result of the inheritance?

Accepted Answer

$24,000,th

Question 19

Dr.J's outstanding player award is not includible in income,since the award is in recognition of his outstanding performance.

Accepted Answer

A) True 
 B)False

Question 20

In the tax law,the definition of gross income is:

Accepted Answer

A) All cash payments received unless excluded by the tax code 
B) All cash payments received for services performed 
C) All income from whatever source derived 
D) All income of any kind unless the income is earned illegally 
A) All cash payments received unless excluded by the tax code 
B) All cash payments received for services performed 
C) All income from whatever source derived 
D) All income of any kind unless the income is earned illegally

Qualified dividends are given special tax treatment.Describe how they are taxed.

Nicole is a student at USB Law;she receives a $52,000 scholarship for 2013.Of the $52,000,$40,000 is used for tuition,$5,000 is used for books,and $7,000 is used for room and board.How much of the scholarship is taxable income for Nicole in 2013?

Andy landscaped his friend's house in return for a couch set and an HD television worth $8,000.How much income must Andy report on his tax return for his services?

Disability benefits are generally taxable to the individual receiving the amounts.

A "no-additional-cost" service includes only those services in the major line of business in which the employee is employed.

If a life insurance policy is transferred to the insured's partnership for valuable consideration,the insurance proceeds are taxable when received by the partnership.

Mary received the following items during 2013: Christmas bonus from her employer $\$ 500$ Christmas gift from her father $\quad \quad \quad \$35$ Prize won in a radio show contest $\quad \$ 100$ What is the total amount of the above items that must be included in Mary's 2013 gross income?

Interest income received by a cash basis taxpayer is generally reported in the tax year it is received.

A taxpayer in the 28 percent tax bracket invests in a City of San Diego bond paying 8 percent interest.What taxable interest rate would provide the same after-tax return?

Karina receives a scholarship of $10,000 to a college.She is also given a job which pays $5,000 a year to help with her expenses.$7,000 of the scholarship is earmarked for tuition and $3,000 is for room and board.How much of the money from the scholarship and the job are taxable to Karina?

Cash allowances for meals or lodging generally must be included in the employee's income.

If a divorce agreement executed in 2013 specifies that a portion of the amount of an alimony payment is contingent upon the status of a child,that portion is considered to be a child support payment.

Child support payments are deductible by the spouse making the payments.

Elmore receives a rental property as an inheritance from his grandmother.The rental is worth $500,000 and Elmore collected rental income of $24,000 during the year. For the year,how much is Elmore's gross income as a result of the inheritance?

Dr.J's outstanding player award is not includible in income,since the award is in recognition of his outstanding performance.

In the tax law,the definition of gross income is:

The Individual Income Tax Return

Business Income and Expenses, Part I

Business Income and Expenses, Part II

Itemized Deductions and Other Incentives

Credits and Special Taxes

Accounting Periods and Methods and Depreciation

Capital Gains and Losses

Withholding, Estimated Payments, and Payroll Taxes

Partnership Taxation

The Corporate Income Tax

Tax Administration and Tax Planning

Filters

Exam 2: Gross Income and Exclusions

Qualified dividends are given special tax treatment.Describe how they are taxed.

Nicole is a student at USB Law;she receives a $52,000 scholarship for 2013.Of the $52,000,$40,000 is used for tuition,$5,000 is used for books,and $7,000 is used for room and board.How much of the scholarship is taxable income for Nicole in 2013?

Andy landscaped his friend's house in return for a couch set and an HD television worth $8,000.How much income must Andy report on his tax return for his services?

Disability benefits are generally taxable to the individual receiving the amounts.

A "no-additional-cost" service includes only those services in the major line of business in which the employee is employed.

If a life insurance policy is transferred to the insured's partnership for valuable consideration,the insurance proceeds are taxable when received by the partnership.

Interest income received by a cash basis taxpayer is generally reported in the tax year it is received.

A taxpayer in the 28 percent tax bracket invests in a City of San Diego bond paying 8 percent interest.What taxable interest rate would provide the same after-tax return?

Karina receives a scholarship of $10,000 to a college.She is also given a job which pays $5,000 a year to help with her expenses.$7,000 of the scholarship is earmarked for tuition and $3,000 is for room and board.How much of the money from the scholarship and the job are taxable to Karina?

Cash allowances for meals or lodging generally must be included in the employee's income.

If a divorce agreement executed in 2013 specifies that a portion of the amount of an alimony payment is contingent upon the status of a child,that portion is considered to be a child support payment.

Child support payments are deductible by the spouse making the payments.

Elmore receives a rental property as an inheritance from his grandmother.The rental is worth $500,000 and Elmore collected rental income of $24,000 during the year. For the year,how much is Elmore's gross income as a result of the inheritance?

Dr.J's outstanding player award is not includible in income,since the award is in recognition of his outstanding performance.

In the tax law,the definition of gross income is:

The Individual Income Tax Return

Business Income and Expenses, Part I

Business Income and Expenses, Part II

Itemized Deductions and Other Incentives

Credits and Special Taxes

Accounting Periods and Methods and Depreciation

Capital Gains and Losses

Withholding, Estimated Payments, and Payroll Taxes

Partnership Taxation

The Corporate Income Tax

Tax Administration and Tax Planning

Filters