Question 1

A Keogh plan for the benefit of a self-employed individual is considered a nonqualified retirement plan.

Accepted Answer

A) True 
 B)False

Question 2

Mrs. Lee, age 70, withdrew $40,000 from her traditional IRA this year. The balance in the account at year-end was $96,600, which included $28,000 of nondeductible contributions. Compute the taxable portion of the $40,000 withdrawal.

Accepted Answer

A)  $0 
B)  $8,199 
C)  $31,801 
D)  $40,000 
A)  $0 
B)  $8,199 
C)  $31,801 
D)  $40,000

Question 3

Which of the following statements regarding Keogh plans is false?

Accepted Answer

A)  Keogh plans provide a tax-deferred retirement savings option for self-employed individuals. 
B)  Keogh plans must be administered by an independent trustee. 
C)  Keogh plans can be either defined-benefit or defined-contribution plans. 
D)  A self-employed person with a Keogh plan is not required to provide retirement benefits to his or her employees through the plan. 
A)  Keogh plans provide a tax-deferred retirement savings option for self-employed individuals. 
B)  Keogh plans must be administered by an independent trustee. 
C)  Keogh plans can be either defined-benefit or defined-contribution plans. 
D)  A self-employed person with a Keogh plan is not required to provide retirement benefits to his or her employees through the plan.

Question 4

Jason Inc. maintains a qualified profit-sharing plan for its employees. This year, Jason contributed $2,300 to Ms. Preston's profit-sharing account. Which of the following statements is true?

Accepted Answer

A)  Jason can deduct the contribution, and Ms. Preston must include the contribution in her gross income. 
B)  Jason can't deduct the contribution, but Ms. Preston must include the contribution in her gross income. 
C)  Jason can deduct the contribution, but Ms. Preston does not include the contribution in her gross income. 
D)  Jason can't deduct the contribution, and Ms. Preston does not include the contribution in her gross income. 
A)  Jason can deduct the contribution, and Ms. Preston must include the contribution in her gross income. 
B)  Jason can't deduct the contribution, but Ms. Preston must include the contribution in her gross income. 
C)  Jason can deduct the contribution, but Ms. Preston does not include the contribution in her gross income. 
D)  Jason can't deduct the contribution, and Ms. Preston does not include the contribution in her gross income.

Question 5

Four years ago, Acnex Inc. granted Ms. Cardena an incentive stock option (ISO) to purchase 1,000 shares of Acnex stock at $44 per share. On date of grant, the market price was $42 per share. This year, Ms. Cardena exercised the ISO when the market price was $75 per share. Which of the following statements is true?

Accepted Answer

A)  Ms. Cardena recognizes $31,000 ordinary income, and Acnex is allowed a $31,000 deduction this year. 
B)  Ms. Cardena recognizes $31,000 ordinary income, but Acnex is allowed no deduction this year. 
C)  Ms. Cardena recognizes no ordinary income, and Acnex is allowed no deduction this year. 
D)  Ms. Cardena recognizes no ordinary income, but Acnex is allowed a $31,000 deduction this year. 
A)  Ms. Cardena recognizes $31,000 ordinary income, and Acnex is allowed a $31,000 deduction this year. 
B)  Ms. Cardena recognizes $31,000 ordinary income, but Acnex is allowed no deduction this year. 
C)  Ms. Cardena recognizes no ordinary income, and Acnex is allowed no deduction this year. 
D)  Ms. Cardena recognizes no ordinary income, but Acnex is allowed a $31,000 deduction this year.

Question 6

Which of the following statements regarding a Roth IRA is false?

Accepted Answer

A)  Contributions to a Roth IRA are nondeductible. 
B)  A Roth IRA is tax exempt. 
C)  Individuals of any age can make tax-exempt withdrawals from a Roth IRA. 
D)  High-income individuals are not allowed to contribute directly to a Roth IRA. 
A)  Contributions to a Roth IRA are nondeductible. 
B)  A Roth IRA is tax exempt. 
C)  Individuals of any age can make tax-exempt withdrawals from a Roth IRA. 
D)  High-income individuals are not allowed to contribute directly to a Roth IRA.

Question 7

Unreimbursed employment-related business expenses are a miscellaneous itemized deduction.

Accepted Answer

A) True 
 B)False

A Keogh plan for the benefit of a self-employed individual is considered a nonqualified retirement plan.

Mrs. Lee, age 70, withdrew $40,000 from her traditional IRA this year. The balance in the account at year-end was $96,600, which included $28,000 of nondeductible contributions. Compute the taxable portion of the $40,000 withdrawal.

Which of the following statements regarding Keogh plans is false?

Jason Inc. maintains a qualified profit-sharing plan for its employees. This year, Jason contributed $2,300 to Ms. Preston's profit-sharing account. Which of the following statements is true?

Which of the following statements regarding a Roth IRA is false?

Unreimbursed employment-related business expenses are a miscellaneous itemized deduction.

Taxes and Taxing Jurisdictions

Policy Standards for a Good Tax

Taxes As Transaction Costs

Maxims of Income Tax Planning

Tax Research

Taxable Income From Business Operations

Property Acquisitions and Cost Recovery Deductions

Property Dispositions

Nontaxable Exchanges

Sole Proprietorships, Partnerships, Llcs, and S Corporations

The Corporate Taxpayer

The Choice of Business Entity

Jurisdictional Issues in Business Taxation

The Individual Tax Formula

Investment and Personal Financial Planning

Tax Consequences of Personal Activities

The Tax Compliance Process

Filters

Exam 15: Compensation and Retirement Planning

A Keogh plan for the benefit of a self-employed individual is considered a nonqualified retirement plan.

Mrs. Lee, age 70, withdrew $40,000 from her traditional IRA this year. The balance in the account at year-end was $96,600, which included $28,000 of nondeductible contributions. Compute the taxable portion of the $40,000 withdrawal.

Which of the following statements regarding Keogh plans is false?

Jason Inc. maintains a qualified profit-sharing plan for its employees. This year, Jason contributed $2,300 to Ms. Preston's profit-sharing account. Which of the following statements is true?

Which of the following statements regarding a Roth IRA is false?

Unreimbursed employment-related business expenses are a miscellaneous itemized deduction.

Taxes and Taxing Jurisdictions

Policy Standards for a Good Tax

Taxes As Transaction Costs

Maxims of Income Tax Planning

Tax Research

Taxable Income From Business Operations

Property Acquisitions and Cost Recovery Deductions

Property Dispositions

Nontaxable Exchanges

Sole Proprietorships, Partnerships, Llcs, and S Corporations

The Corporate Taxpayer

The Choice of Business Entity

Jurisdictional Issues in Business Taxation

The Individual Tax Formula

Investment and Personal Financial Planning

Tax Consequences of Personal Activities

The Tax Compliance Process

Filters