Harvey itemized deductions on his 2017 income tax return.Harvey plans to itemize deductions again in 2018 and the following information is available regarding state and local income taxes: \[\begin{array} { l r } \text { Taxes withheld in } 2018 & \$ 12,500 \\ \text { Refund received in } 2018 \text { for } 2015 \text { tax } & \$ 500 \\ \text { Assessment paid in } 2018 \text { for } 2016 \text { tax } & \$ 300 \end{array}\] Assuming he deducts state and local income taxes, the above information should be reported by Harvey in his 2018 tax return as:

A) Itemized deduction for state and local income taxes of $12,500, and income from state and local tax refund of $200 B) Itemized deduction for state and local income taxes of $12,300 C) Itemized deduction for state and local income taxes of $12,800 D) Itemized deduction for state and local income taxes of $10,000 and income from state and local tax refund of $500 E) None of the above A) Itemized deduction for state and local income taxes of $12,500, and income from state and local tax refund of $200 B) Itemized deduction for state and local income taxes of $12,300 C) Itemized deduction for state and local income taxes of $12,800 D) Itemized deduction for state and local income taxes of $10,000 and income from state and local tax refund of $500 E) None of the above

During the current year, Mr.and Mrs.West paid the following taxes: $\begin{array}{llcc} \text {Property taxes on residence } & \$1,900 \\ \text { Special asses sment for installation of a sewer system in their neighborhood} &\$1,000\\ \text {State personal property tax on their automobile (based on value) } &\$400\\ \text { Property taxes on land held for long-term appreciation } &\$600\\ \end{array}$ What amount can the Wests deduct as property taxes in calculating itemized deductions for the current year?

A) $0 B) $1,900 C) $2,300 D) $2,900 E) None of the above A) $0 B) $1,900 C) $2,300 D) $2,900 E) None of the above

Exam 5: Deductions and Adjustments to Income

Harvey itemized deductions on his 2017 income tax return.Harvey plans to itemize deductions again in 2018 and the following information is available regarding state and local income taxes: Taxes withheld in 2018 \ 12,500 Refund received in 2018 for 2015 tax \ 500 Assessment paid in 2018 for 2016 tax \ 300 Assuming he deducts state and local income taxes, the above information should be reported by Harvey in his 2018 tax return as:

(Multiple Choice)

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Question 41

The investment interest expense deduction is limited to the taxpayer's net investment income.

(True/False)

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Question 42

If an employer makes a contribution to a qualified retirement plan on behalf of an employee, the amount is currently deductible by the employer, and the employee must include the amount in gross income at the time the contribution is made.

(True/False)

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Question 43

Which of the following is not deductible as an itemized deduction?

(Multiple Choice)

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Question 44

Christine saw a television advertisement asking for donations of used vehicles to a charitable foundation and decided to donate her old car.Which of the following statements is correct?

(Multiple Choice)

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Question 45

Which of the following taxes is not deductible as an itemized deduction?

(Multiple Choice)

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Question 46

Self-employed taxpayers can deduct the cost of uniforms, but not employees.

(True/False)

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Question 47

Which of the following professions is not eligible for a for AGI deduction related to certain unreimbursed business expenses:

(Multiple Choice)

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Question 48

The cost of over-the-counter aspirin and decongestants is a deductible medical expense even though they are nonprescription drugs.

(True/False)

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Question 49

Jim is a single high school chemistry teacher.In 2018, his chemistry lab is short supplies and so he spends $300 of his own money purchasing missing items needed for the upcoming labs.Jim may deduct the entire $300.

(True/False)

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Question 50

During the current year, Mr.and Mrs.West paid the following taxes: Property taxes on residence \1 ,900 Special asses sment for installation of a sewer system in their neighborhood \1 ,000 State personal property tax on their automobile (based on value) \4 00 Property taxes on land held for long-term appreciation \6 00 What amount can the Wests deduct as property taxes in calculating itemized deductions for the current year?

(Multiple Choice)

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Question 51

Frank was so entertained by the Paris Symphony on his visit to France that he mailed them a donation of $100 to support their organization as soon as he returned home to Seattle.Frank may deduct the charitable contribution to the Paris Symphony on his US tax return.

(True/False)

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Question 52

Roberto, age 50, has AGI of $110,000 for 2018.He has medical expenses of $13,200.How much of the medical expenses can Roberto deduct on his Schedule A for 2018?

(Multiple Choice)

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Question 53

In 2018, Richie Rominey purchases a new $4.3 million qualified principal residence in Palo Alto, California using a mortgage loan of $3 million.Richie's mortgage interest deduction may be limited.

(True/False)

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Question 54

In 2018, all taxpayers may make a deductible or nondeductible contribution to an IRA.

(True/False)

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Question 55

Earnings on nondeductible IRA contributions are allowed to accumulate tax-free until they are withdrawn.

(True/False)

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Question 56

Shellie, a single individual, received her Bachelor's degree in 2017, and took a job with a salary of $45,000 per year.In 2018, she began paying interest on qualified education loans.She was able to pay $1,500 in 2018.Which of the following statements is correct?

(Multiple Choice)

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Question 57

If a taxpayer contributes a painting to a museum but reserves the right to use the painting for parties, he may not be allowed a deduction for the charitable contribution.

(True/False)

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Question 58

If real property is sold during the year, the property taxes must be allocated between the buyer and seller based on the number of days the property was held by each party.

(True/False)

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Question 59

Don donates his old car to a qualified charity.The charity then sells the car at an auction.Describe the tax treatment of the donation.

(Essay)

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Question 60

Showing 41 - 60 of 135

The investment interest expense deduction is limited to the taxpayer's net investment income.

If an employer makes a contribution to a qualified retirement plan on behalf of an employee, the amount is currently deductible by the employer, and the employee must include the amount in gross income at the time the contribution is made.

Which of the following is not deductible as an itemized deduction?

Christine saw a television advertisement asking for donations of used vehicles to a charitable foundation and decided to donate her old car.Which of the following statements is correct?

Which of the following taxes is not deductible as an itemized deduction?

Self-employed taxpayers can deduct the cost of uniforms, but not employees.

Which of the following professions is not eligible for a for AGI deduction related to certain unreimbursed business expenses:

The cost of over-the-counter aspirin and decongestants is a deductible medical expense even though they are nonprescription drugs.

Jim is a single high school chemistry teacher.In 2018, his chemistry lab is short supplies and so he spends $300 of his own money purchasing missing items needed for the upcoming labs.Jim may deduct the entire $300.

Frank was so entertained by the Paris Symphony on his visit to France that he mailed them a donation of $100 to support their organization as soon as he returned home to Seattle.Frank may deduct the charitable contribution to the Paris Symphony on his US tax return.

Roberto, age 50, has AGI of $110,000 for 2018.He has medical expenses of $13,200.How much of the medical expenses can Roberto deduct on his Schedule A for 2018?

In 2018, Richie Rominey purchases a new $4.3 million qualified principal residence in Palo Alto, California using a mortgage loan of $3 million.Richie's mortgage interest deduction may be limited.

In 2018, all taxpayers may make a deductible or nondeductible contribution to an IRA.

Earnings on nondeductible IRA contributions are allowed to accumulate tax-free until they are withdrawn.

Shellie, a single individual, received her Bachelor's degree in 2017, and took a job with a salary of $45,000 per year.In 2018, she began paying interest on qualified education loans.She was able to pay $1,500 in 2018.Which of the following statements is correct?

If a taxpayer contributes a painting to a museum but reserves the right to use the painting for parties, he may not be allowed a deduction for the charitable contribution.

If real property is sold during the year, the property taxes must be allocated between the buyer and seller based on the number of days the property was held by each party.

Don donates his old car to a qualified charity.The charity then sells the car at an auction.Describe the tax treatment of the donation.

The Individual Income Tax Return

Gross Income and Exclusions

Additional Income Part 1

Additional Income Part 2

Accounting Methods and Taxes

Tax Credits

Depreciation and Sale of Business Property

Payroll, Estimated Payments, and Retirement Plans

Partnership Taxation

The Corporate Income Tax

Tax Administration and Tax Planning

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