Question 1

For 2014,the amount of the student loan interest deduction is limited to $3,500.

Accepted Answer

A) True 
 B)False

Question 2

Rebecca is required under a divorce agreement effective January 1,2014 to pay $800 of alimony and $250 of child support per month for 10 years.Rebecca also makes a voluntary payment of $150 per month.How much of each monthly payment can Rebecca deduct as alimony in 2014?

Accepted Answer

A) $ 0. 
B) $800. 
C) $950. 
D) $1050. 
A) $ 0. 
B) $800. 
C) $950. 
D) $1050.

Question 3

Under a divorce agreement executed in 2014,periodic payments of either cash or property must be made at regular intervals to be deductible as alimony.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following expenses does not qualify as a moving expense?

Accepted Answer

A) Lodging. 
B) Travel expenses. 
C) House hunting expenses. 
D) Transportation of household goods. 
A) Lodging. 
B) Travel expenses. 
C) House hunting expenses. 
D) Transportation of household goods.

Question 5

Henry graduated from the University of Maryland in 2012.In 2014,to take advantage of lower interest rates,he refinanced his qualified education loans with another qualified student loan.He is not a dependent on another person's tax return.Before AGI limits,what is the maximum deduction available to him for the $3,200 he paid for educational student loan interest in 2014?

Accepted Answer

A) $0. 
B) $2,000. 
C) $2,500. 
D) $3,000. 
A) $0. 
B) $2,000. 
C) $2,500. 
D) $3,000.

Question 6

Tuition,fees,books,supplies,room,board,and other necessary expenses of attendance are qualified education expenses for purposes of the student loan interest deduction.

Accepted Answer

A) True 
 B)False

Question 7

What is the key limitation related to income associated with deductibility of student loan interest?

Accepted Answer

The deduction may be limited based on th

Question 8

Books purchased for courses at the campus bookstore,independent of tuition charges,are eligible expenses for the tuition and fees deduction.

Accepted Answer

A) True 
 B)False

Question 9

At the beginning of 2014,Melissa was permanently transferred from her office in New York City to New Jersey.Her office in NYC was 15 miles from her old NY home.For Melissa to meet the distance test for qualifying moving expense deductions,how many miles must the office in New Jersey be from her old home?

Accepted Answer

A) 65. 
B) 50. 
C) 40. 
D) 35. 
A) 65. 
B) 50. 
C) 40. 
D) 35.

Question 10

In order to meet the time test for qualifying moving expenses,a taxpayer must:

Accepted Answer

A) Be a full-time employee for a period of 39 weeks during the 12 months following arrival in the new area. 
B) Be a self-employed individual for at least 78 weeks during the 24 months immediately following arrival in the new area.At least 39 of the 78 weeks must be during the first 12-month period. 
C) Remain employed only in the initial new job for the entire 39 or 78 week period. 
D) a and 
A) Be a full-time employee for a period of 39 weeks during the 12 months following arrival in the new area. 
B) Be a self-employed individual for at least 78 weeks during the 24 months immediately following arrival in the new area.At least 39 of the 78 weeks must be during the first 12-month period. 
C) Remain employed only in the initial new job for the entire 39 or 78 week period. 
D) a and

Question 11

Which of the following items are considered alimony?

Accepted Answer

A) Payments made to a third party on behalf of the former spouse for the former spouse's dental expenses. 
B) Payments made for a six month period after the death of the recipient spouse. 
C) Noncash property settlement. 
D) Payments made on a piece of property transferred to the ex-spouse under the settlement agreement. 
A) Payments made to a third party on behalf of the former spouse for the former spouse's dental expenses. 
B) Payments made for a six month period after the death of the recipient spouse. 
C) Noncash property settlement. 
D) Payments made on a piece of property transferred to the ex-spouse under the settlement agreement.

Question 12

Distributions from Health Savings Accounts (HSAs)are subject to tax,if they are used to pay for qualified medical expenses.

Accepted Answer

A) True 
 B)False

Question 13

What is meant by a penalty on early withdrawal of savings and under what circumstances is it deductible?

Accepted Answer

Banks often require minimum or fixed dep

Question 14

Are any moving expenses deductible other than those incurred directly for the taxpayer? If so,what are the requirements for deductibility?

Accepted Answer

Moving expenses of persons other than th

Question 15

The percentage of self-employed health insurance premiums that is deductible as a for AGI deduction is:

Accepted Answer

A) 100%. 
B) 80%. 
C) 70%. 
D) 50%. 
A) 100%. 
B) 80%. 
C) 70%. 
D) 50%.

Question 16

In order to qualify for a Health Savings Plan (HSA),a taxpayer must be:

Accepted Answer

A) An employee (or spouse)who works for an employer with a high deductible health plan. 
B) A self-employed individual. 
C) An uninsured employee of a company that does not offer health coverage,who purchases high-deductible health coverage on his or her own. 
D) All of the above. 
A) An employee (or spouse)who works for an employer with a high deductible health plan. 
B) A self-employed individual. 
C) An uninsured employee of a company that does not offer health coverage,who purchases high-deductible health coverage on his or her own. 
D) All of the above.

Question 17

Under a court-ordered decree of separate maintenance executed in 2014,Rebecca is required to pay her ex-husband,Carl,$4,750 a month until their youngest son turns age 18.At that time,the required payments are reduced to $2,100 per month.How much of each payment is deductible by Rebecca as alimony for 2014?

Accepted Answer

A) $6,850. 
B) $4,750. 
C) $2,100. 
D) $ 0. 
A) $6,850. 
B) $4,750. 
C) $2,100. 
D) $ 0.

Question 18

Renee and Thomas obtained a divorce effective May 1,2014.In accordance with the divorce decree,Thomas was required to pay Renee alimony of $2,500 per month (payments were to stop only in the event of her death or remarriage).Furthermore,he was to transfer title of their house which had a cost of $150,000 and a fair value of $200,000 on the date of transfer,and was to continue making the monthly mortgage payments of $1,500.
(a)Determine the amount of Thomas's alimony deduction in 2014.
(b)Determine the amount of Renee's alimony income in 2014.
(c)Assume that Thomas was required to pay off the remaining mortgage balance in the event Renee died.Does Thomas's alimony deduction in 2014 change? Why or why not?
(a)Thomas would report alimony payments of $32,000 in 2014.This represents the monthly payments of $2,500 to Renee plus the $1,500 mortgage payments,both for a period of eight months.
(b)Renee would have alimony income of $32,000 determined in the same manner as part (a).
(c)Thomas would be entitled to an alimony deduction of $20,000 in 2014.This amount represents eight months of $2,500 payments,but no deduction for the $1,500 mortgage payments.For a payment to be classified as alimony,the payment must cease at the payee spouse's death.If any payments are required to be made after the death of the spouse,then,under IRC § 71(b)(1)(D),the payments do not qualify as alimony,even payments made during the life of the spouse.In the problem,Thomas is required to pay off the mortgage balance if Renee dies.Since payoff is not required UNTIL she dies,Thomas will not make the payoff until AFTER she dies.Thus,the mortgage payments are not deemed to be alimony.

Accepted Answer

The answer of Renee and Thomas obtained a divorce effective...

Question 19

An eligible educator,in the K through 12 educational system,for purposes of the educator's expense deduction is:

Accepted Answer

A) A teacher. 
B) A counselor. 
C) A principal. 
D) All of the above. 
A) A teacher. 
B) A counselor. 
C) A principal. 
D) All of the above.

Question 20

The payment of alimony has tax ramifications.These tax ramifications only affect the payor of the alimony.

Accepted Answer

A) True 
 B)False

For 2014,the amount of the student loan interest deduction is limited to $3,500.

Rebecca is required under a divorce agreement effective January 1,2014 to pay $800 of alimony and $250 of child support per month for 10 years.Rebecca also makes a voluntary payment of $150 per month.How much of each monthly payment can Rebecca deduct as alimony in 2014?

Under a divorce agreement executed in 2014,periodic payments of either cash or property must be made at regular intervals to be deductible as alimony.

Which of the following expenses does not qualify as a moving expense?

Tuition,fees,books,supplies,room,board,and other necessary expenses of attendance are qualified education expenses for purposes of the student loan interest deduction.

What is the key limitation related to income associated with deductibility of student loan interest?

Books purchased for courses at the campus bookstore,independent of tuition charges,are eligible expenses for the tuition and fees deduction.

In order to meet the time test for qualifying moving expenses,a taxpayer must:

Which of the following items are considered alimony?

Distributions from Health Savings Accounts (HSAs)are subject to tax,if they are used to pay for qualified medical expenses.

What is meant by a penalty on early withdrawal of savings and under what circumstances is it deductible?

Are any moving expenses deductible other than those incurred directly for the taxpayer? If so,what are the requirements for deductibility?

The percentage of self-employed health insurance premiums that is deductible as a for AGI deduction is:

In order to qualify for a Health Savings Plan (HSA),a taxpayer must be:

An eligible educator,in the K through 12 educational system,for purposes of the educator's expense deduction is:

The payment of alimony has tax ramifications.These tax ramifications only affect the payor of the alimony.

Introduction to Taxation, the Income Tax Formula, and Form 1040ez

Expanded Tax Formula, Forms 1040a and 1040, and Basic Concepts

Gross Income: Inclusions and Exclusions

Itemized Deductions

Self-Employed Business Income

Capital Gains and Other Sales of Property

Rental Property, Royalties, and Income From Flow-Through Entities

Tax Credits

Payroll Taxes

Retirement and Other Tax-Deferred Plans and Annuities

Special Property Transactions

At-Riskpassive Activity Loss Rules and the Individual Alternative Minimum Tax

Partnership Taxation

Corporate Taxation

Filters

Exam 4: Adjustments for Adjusted Gross Income

For 2014,the amount of the student loan interest deduction is limited to $3,500.

Rebecca is required under a divorce agreement effective January 1,2014 to pay $800 of alimony and $250 of child support per month for 10 years.Rebecca also makes a voluntary payment of $150 per month.How much of each monthly payment can Rebecca deduct as alimony in 2014?

Under a divorce agreement executed in 2014,periodic payments of either cash or property must be made at regular intervals to be deductible as alimony.

Which of the following expenses does not qualify as a moving expense?

Tuition,fees,books,supplies,room,board,and other necessary expenses of attendance are qualified education expenses for purposes of the student loan interest deduction.

What is the key limitation related to income associated with deductibility of student loan interest?

Books purchased for courses at the campus bookstore,independent of tuition charges,are eligible expenses for the tuition and fees deduction.

In order to meet the time test for qualifying moving expenses,a taxpayer must:

Which of the following items are considered alimony?

Distributions from Health Savings Accounts (HSAs)are subject to tax,if they are used to pay for qualified medical expenses.

What is meant by a penalty on early withdrawal of savings and under what circumstances is it deductible?

Are any moving expenses deductible other than those incurred directly for the taxpayer? If so,what are the requirements for deductibility?

The percentage of self-employed health insurance premiums that is deductible as a for AGI deduction is:

In order to qualify for a Health Savings Plan (HSA),a taxpayer must be:

An eligible educator,in the K through 12 educational system,for purposes of the educator's expense deduction is:

The payment of alimony has tax ramifications.These tax ramifications only affect the payor of the alimony.

Introduction to Taxation, the Income Tax Formula, and Form 1040ez

Expanded Tax Formula, Forms 1040a and 1040, and Basic Concepts

Gross Income: Inclusions and Exclusions

Itemized Deductions

Self-Employed Business Income

Capital Gains and Other Sales of Property

Rental Property, Royalties, and Income From Flow-Through Entities

Tax Credits

Payroll Taxes

Retirement and Other Tax-Deferred Plans and Annuities

Special Property Transactions

At-Riskpassive Activity Loss Rules and the Individual Alternative Minimum Tax

Partnership Taxation

Corporate Taxation

Filters