Question 1

Which of the following is a true statement?

Accepted Answer

A) Individuals qualify for the moving expense deduction only if they change employers. 
B) Individuals qualify for the moving expense deduction if their employer does not pay for the moving expenses. 
C) Moving expenses are deductible from AGI. 
D) Moving expenses are generally not deductible. 
A) Individuals qualify for the moving expense deduction only if they change employers. 
B) Individuals qualify for the moving expense deduction if their employer does not pay for the moving expenses. 
C) Moving expenses are deductible from AGI. 
D) Moving expenses are generally not deductible.

Question 2

Madeoff donated stock (capital gain property)to a public charity.He purchased the stock three years ago for $100,000,and on the date of the gift,it had a fair market value of $200,000.What is his maximum charitable contribution deduction for the year related to this stock if his AGI is $500,000?

Accepted Answer

A) $100,000. 
B) $200,000. 
C) $150,000. 
D) $250,000. 
E) None of the choices are correct. 
A) $100,000. 
B) $200,000. 
C) $150,000. 
D) $250,000. 
E) None of the choices are correct.

Question 3

Chuck has AGI of $70,000 and has made the following payments:
   Calculate the amount of taxes that Chuck can include with his itemized deductions.

Accepted Answer

$4,050 = $1,900 + $850 + $790

Question 4

When taxpayers donate cash and capital gain property to a public charity,the AGI percentage limitation is applied in the following order:

Accepted Answer

A) a 30 percent of AGI limitation is applied to the aggregate donation. 
B) a 60 percent of AGI limitation is applied to the cash donation and a 20 percent of AGI limitation is applied to the fair market value of the capital gain donation. 
C) a 30 percent of AGI limitation is applied to the cash donation and a 20 percent of AGI limitation is applied to the fair market value of the capital gain donation. 
D) a 60 percent of AGI limitation is applied to the cash donation and the fair market value of the capital gain donation is subject to the lesser of a 30 percent of AGI limitation or a 50 percent of AGI limitation after subtracting the cash contributions. 
E) donations to public charities are not subject to AGI limitations. 
A) a 30 percent of AGI limitation is applied to the aggregate donation. 
B) a 60 percent of AGI limitation is applied to the cash donation and a 20 percent of AGI limitation is applied to the fair market value of the capital gain donation. 
C) a 30 percent of AGI limitation is applied to the cash donation and a 20 percent of AGI limitation is applied to the fair market value of the capital gain donation. 
D) a 60 percent of AGI limitation is applied to the cash donation and the fair market value of the capital gain donation is subject to the lesser of a 30 percent of AGI limitation or a 50 percent of AGI limitation after subtracting the cash contributions. 
E) donations to public charities are not subject to AGI limitations.

Question 5

Campbell,a single taxpayer,has $95,000 of profits from her general store,which she operates as a sole proprietorship.She has no employees,$40,000 of qualified property,and $50,000 of taxable income before the deduction for qualified business income.How much is Campbell's deduction for qualified business income?

Accepted Answer

A) $95,000. 
B) $19,000. 
C) $10,000. 
D) $8,000. 
E) $0. 
A) $95,000. 
B) $19,000. 
C) $10,000. 
D) $8,000. 
E) $0.

Question 6

Which of the following is a true statement?

Accepted Answer

A) Congress allows self-employed taxpayers to deduct the employer portion of their self-employment tax. 
B) To deduct expenses associated with any profit-motivated activity,taxpayers must maintain a high level of involvement or effort in the activity throughout the year. 
C) Business activities never require a relatively high level of involvement or effort from the taxpayer. 
D) All business expenses are deducted for AGI. 
E) All of these choices are correct. 
A) Congress allows self-employed taxpayers to deduct the employer portion of their self-employment tax. 
B) To deduct expenses associated with any profit-motivated activity,taxpayers must maintain a high level of involvement or effort in the activity throughout the year. 
C) Business activities never require a relatively high level of involvement or effort from the taxpayer. 
D) All business expenses are deducted for AGI. 
E) All of these choices are correct.

Question 7

Taxpayers traveling for the primary purpose of receiving essential and deductible medical care may deduct the cost of travel.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following is a true statement?

Accepted Answer

A) The standard deduction is increased for taxpayers who are blind or deaf at year-end. 
B) A married couple is only entitled to one addition to their standard deduction even if both spouses are both over age 65. 
C) Bunching itemized deductions is a legal method of tax avoidance. 
D) The standard deduction is subject to a phase-out based on AGI. 
E) All of these choices are true. 
A) The standard deduction is increased for taxpayers who are blind or deaf at year-end. 
B) A married couple is only entitled to one addition to their standard deduction even if both spouses are both over age 65. 
C) Bunching itemized deductions is a legal method of tax avoidance. 
D) The standard deduction is subject to a phase-out based on AGI. 
E) All of these choices are true.

Question 9

Which of the following is a true statement?

Accepted Answer

A) Taxpayers may only deduct interest on up to $1,500,000 of acquisition indebtedness. 
B) Taxpayers may deduct interest on up to $1,000,000 of home-equity debt. 
C) The deduction for investment interest expense is not subject to limitation. 
D) A taxpayer who incurs acquisition indebtedness in 2018 may only deduct interest on up to $750,000 of acquisition indebtedness. 
E) None of the choices are correct. 
A) Taxpayers may only deduct interest on up to $1,500,000 of acquisition indebtedness. 
B) Taxpayers may deduct interest on up to $1,000,000 of home-equity debt. 
C) The deduction for investment interest expense is not subject to limitation. 
D) A taxpayer who incurs acquisition indebtedness in 2018 may only deduct interest on up to $750,000 of acquisition indebtedness. 
E) None of the choices are correct.

Question 10

Rachel is an engineer who practices as a sole proprietor.This year,Rachel had net business income of $500,000 from her business.Assume that Rachel pays $20,000 wages to her employees,she has $500,000 of property (unadjusted basis of equipment she purchased last year),she has no capital gains,and her taxable income before the deduction for qualified business income is $380,000.Calculate Rachel's deduction for qualified business income.

Accepted Answer

$17,500.Engineering is a qualified trade

Question 11

Which of the following is a true statement?

Accepted Answer

A) Unreimbursed employee business expenses are not deductible. 
B) Investment advisory expenses are not deductible. 
C) Business deductions are one of the most common deductions for AGI,but they are not readily visible on Schedule 1 of Form 1040. 
D) The distinction between business and investment expenses is critical for determining whether a deduction is claimed above the line (for AGI)or below the line (itemized). 
E) All of these choices are correct. 
A) Unreimbursed employee business expenses are not deductible. 
B) Investment advisory expenses are not deductible. 
C) Business deductions are one of the most common deductions for AGI,but they are not readily visible on Schedule 1 of Form 1040. 
D) The distinction between business and investment expenses is critical for determining whether a deduction is claimed above the line (for AGI)or below the line (itemized). 
E) All of these choices are correct.

Question 12

Jenna (age 50)files single and reports AGI of $40,000.This year she has incurred the following medical expenses:
   Calculate the amount of medical expenses that will be included with Jenna's other itemized deductions.

Accepted Answer

$1,910.All expenses are qualified medica

Question 13

Ned is a head of household with a dependent son,Todd,who is a full-time student.This year Ned made the following expenditures related to Todd's support:   What amount can Ned include in his itemized deductions?

Accepted Answer

A) $1,700 included in Ned's miscellaneous itemized deductions. 
B) $2,050 included in Ned's miscellaneous itemized deductions. 
C) $950 included in Ned's miscellaneous itemized deductions. 
D) $600 included in Ned's medical expenses. 
E) None of the choices are correct. 
A) $1,700 included in Ned's miscellaneous itemized deductions. 
B) $2,050 included in Ned's miscellaneous itemized deductions. 
C) $950 included in Ned's miscellaneous itemized deductions. 
D) $600 included in Ned's medical expenses. 
E) None of the choices are correct.

Question 14

Rachel is an engineer who practices as a sole proprietor.This year,Rachel had net business income of $400,000 from her business.Assume that Rachel pays $150,000 wages to her employees,she has $20,000 of property (unadjusted basis of equipment she purchased last year),she has no capital gains,and her taxable income before the deduction for qualified business income is $380,000.Calculate Rachel's deduction for qualified business income.

Accepted Answer

$75,000.Engineering is a qualified trade

Question 15

Carly donated inventory (ordinary income property)to a church.She purchased the inventory last month for $100,000,and on the date of the gift,it had a fair market value of $92,000.What is her maximum charitable contribution deduction for the year related to this inventory if her AGI is $200,000?

Accepted Answer

A) $100,000. 
B) $92,000. 
C) $60,000. 
D) $46,000 if the church sells the inventory. 
E) None of the choices are correct. 
A) $100,000. 
B) $92,000. 
C) $60,000. 
D) $46,000 if the church sells the inventory. 
E) None of the choices are correct.

Question 16

Taxpayers generally deduct the lesser of their standard deduction or their itemized deductions.

Accepted Answer

A) True 
 B)False

Question 17

Rachel is an accountant who practices as a sole proprietor.This year,Rachel had net business income of $270,000 from her practice.Assume that Rachel pays $50,000 wages to her employees,she has $20,000 of property (unadjusted basis of equipment she purchased last year),she has no capital gains,and her taxable income before the deduction for qualified business income is $225,000.Calculate Rachel's deduction for qualified business income.

Accepted Answer

$0.Since Rachel has taxable income of $2

Question 18

This year,Jong paid $3,000 of interest on a qualified education loan.Jong files married filing jointly and reports modified AGI of $152,000.What is Jong's deduction for interest expense on an educational loan?

Accepted Answer

A) $2,500. 
B) $3,000. 
C) $1,500. 
D) $1,000. 
E) None of the choices are correct. 
A) $2,500. 
B) $3,000. 
C) $1,500. 
D) $1,000. 
E) None of the choices are correct.

Question 19

This year Latrell made the following charitable contributions:
   Determine the maximum amount of Latrell's charitable deduction assuming the Jones Foundation is a private nonoperating foundation and Latrell's AGI is $100,000 this year.You may assume that the stock and painting have been owned for 10 years.

Accepted Answer

The charitable deduction is $40,500 over

Question 20

Which of the following taxes will not qualify as an itemized deduction?

Accepted Answer

A) Personal property taxes assessed on the value of specific property. 
B) State,local,and foreign income taxes. 
C) Real estate taxes on a residence. 
D) Gasoline taxes on personal travel. 
E) None of the choices qualify as itemized deductions. 
A) Personal property taxes assessed on the value of specific property. 
B) State,local,and foreign income taxes. 
C) Real estate taxes on a residence. 
D) Gasoline taxes on personal travel. 
E) None of the choices qualify as itemized deductions.

Which of the following is a true statement?

Madeoff donated stock (capital gain property)to a public charity.He purchased the stock three years ago for $100,000,and on the date of the gift,it had a fair market value of $200,000.What is his maximum charitable contribution deduction for the year related to this stock if his AGI is $500,000?

Chuck has AGI of $70,000 and has made the following payments: Calculate the amount of taxes that Chuck can include with his itemized deductions.

When taxpayers donate cash and capital gain property to a public charity,the AGI percentage limitation is applied in the following order:

Which of the following is a true statement?

Taxpayers traveling for the primary purpose of receiving essential and deductible medical care may deduct the cost of travel.

Which of the following is a true statement?

Which of the following is a true statement?

Which of the following is a true statement?

Jenna (age 50)files single and reports AGI of $40,000.This year she has incurred the following medical expenses: Calculate the amount of medical expenses that will be included with Jenna's other itemized deductions.

Ned is a head of household with a dependent son,Todd,who is a full-time student.This year Ned made the following expenditures related to Todd's support: What amount can Ned include in his itemized deductions?

Carly donated inventory (ordinary income property)to a church.She purchased the inventory last month for $100,000,and on the date of the gift,it had a fair market value of $92,000.What is her maximum charitable contribution deduction for the year related to this inventory if her AGI is $200,000?

Taxpayers generally deduct the lesser of their standard deduction or their itemized deductions.

This year,Jong paid $3,000 of interest on a qualified education loan.Jong files married filing jointly and reports modified AGI of $152,000.What is Jong's deduction for interest expense on an educational loan?

Which of the following taxes will not qualify as an itemized deduction?

An Introduction to Tax

Tax Compliance,the Irs,and Tax Authorities

Tax Planning Strategies and Related Limitations

Individual Income Tax Overview,dependents,and Filing Status

Gross Income and Exclusions

Investments

Individual Income Tax Computation and Tax Credits

Business Income,deductions,and Accounting Methods

Property Acquisition and Cost Recovery

Property Dispositions

Compensation

Retirement Savings and Deferred Compensation

Tax Consequences of Home Ownership

Entities Overview

Corporate Operations

Accounting for Income Taxes

Corporate Taxation: Nonliquidating Distributions

Corporate Formation,reorganization,and Liquidation

Forming and Operating Partnerships

Dispositions of Partnership Interests and Partnership Distributions

S Corporations

State and Local Taxes

The Ustaxation of Multinational Transactions

Transfer Taxes and Wealth Planning

Filters

Exam 6: Individual Deductions

Which of the following is a true statement?

Madeoff donated stock (capital gain property)to a public charity.He purchased the stock three years ago for $100,000,and on the date of the gift,it had a fair market value of $200,000.What is his maximum charitable contribution deduction for the year related to this stock if his AGI is $500,000?

Chuck has AGI of $70,000 and has made the following payments: Calculate the amount of taxes that Chuck can include with his itemized deductions.

When taxpayers donate cash and capital gain property to a public charity,the AGI percentage limitation is applied in the following order:

Which of the following is a true statement?

Taxpayers traveling for the primary purpose of receiving essential and deductible medical care may deduct the cost of travel.

Which of the following is a true statement?

Which of the following is a true statement?

Which of the following is a true statement?

Jenna (age 50)files single and reports AGI of $40,000.This year she has incurred the following medical expenses: Calculate the amount of medical expenses that will be included with Jenna's other itemized deductions.

Ned is a head of household with a dependent son,Todd,who is a full-time student.This year Ned made the following expenditures related to Todd's support: What amount can Ned include in his itemized deductions?

Carly donated inventory (ordinary income property)to a church.She purchased the inventory last month for $100,000,and on the date of the gift,it had a fair market value of $92,000.What is her maximum charitable contribution deduction for the year related to this inventory if her AGI is $200,000?

Taxpayers generally deduct the lesser of their standard deduction or their itemized deductions.

This year,Jong paid $3,000 of interest on a qualified education loan.Jong files married filing jointly and reports modified AGI of $152,000.What is Jong's deduction for interest expense on an educational loan?

Which of the following taxes will not qualify as an itemized deduction?

An Introduction to Tax

Tax Compliance,the Irs,and Tax Authorities

Tax Planning Strategies and Related Limitations

Individual Income Tax Overview,dependents,and Filing Status

Gross Income and Exclusions

Investments

Individual Income Tax Computation and Tax Credits

Business Income,deductions,and Accounting Methods

Property Acquisition and Cost Recovery

Property Dispositions

Compensation

Retirement Savings and Deferred Compensation

Tax Consequences of Home Ownership

Entities Overview

Corporate Operations

Accounting for Income Taxes

Corporate Taxation: Nonliquidating Distributions

Corporate Formation,reorganization,and Liquidation

Forming and Operating Partnerships

Dispositions of Partnership Interests and Partnership Distributions

S Corporations

State and Local Taxes

The Ustaxation of Multinational Transactions

Transfer Taxes and Wealth Planning

Filters