Question 1

A taxpayer may donate the free use of property to a charitable organization and deduct the value as an itemized deduction.

Accepted Answer

A) True 
 B)False

Question 2

During the current year, George, a salaried taxpayer, paid the following taxes which were not incurred in connection with a trade or business: $$\begin{array} { l r } 
\text { Federal income tax (withheld by employer) } & \$ 1,500 \
\text { State income tax (withheld by employer) } & \$ 1,100 \
\text { FICA tax (withheld by employer) } & \$ 700 \
\text { Real property taxes } & \$ 300 \
\text { Federal auto gasoline taxes } & \$ 200 \
\text { Federal excise tax on telephone bills } & \$ 50
\end{array}$$ What amount can George claim for the current year as an itemized deduction for the taxes paid, assuming he deducts state and local income taxes?

Accepted Answer

A) $1,100 
B) $1,150 
C) $1,400 
D) $2,000 
E) None of the above 
A) $1,100 
B) $1,150 
C) $1,400 
D) $2,000 
E) None of the above

Question 3

Newt is a single taxpayer living in Hollywood, California, with adjusted gross income for the 2018 tax year of $43,050.Newt's employer withheld $3,700 in state income tax from his salary.In April of 2018, he paid $300 in additional state taxes for his prior year's return.The real estate taxes on his home are $1,800 for 2018 and his personal property tax based on the value of his automobile is $75.Also, he paid $210 for state gasoline taxes for the year.The IRS estimate of general sales tax for Newt is $1,200 for 2018.​How much should Newt deduct on Schedule A of Form 1040 of his 2018 tax return for taxes paid?

Accepted Answer

\[\begin{array}{l}
\text { State tax wit

Question 4

Amy paid the following interest expense during the current year: $\begin{array}{llcc}
  \text {Qualified home mortgage interest  } & \$5,000 \
 \text { Credit card interest } &\$1,000\
 \text { Personal bank loan interest } &\$3,000\
 \text {  } &\
 \text {  } &\
 \text {  } &\
\end{array}$
 What is the amount of Amy's interest deduction for the current year?

Accepted Answer

A) $8,000 
B) $3,000 
C) $4,000 
D) $5,000 
E) $6,000 
A) $8,000 
B) $3,000 
C) $4,000 
D) $5,000 
E) $6,000

Question 5

In 2018, the adjusted gross income (AGI)limitation on medical expenses is 15 percent.

Accepted Answer

A) True 
 B)False

Question 6

For the current tax year, David, a married taxpayer filing a joint return, reported the following: $\begin{array}{llcc}
  \text {Investment income from interest  } &\$24,000  \
 \text {  Investment expenses other than interest} &\$3,000\
 \text { Interest expense on funds borrowed 10 years ago to purchase investment } &\
 \text { property } &\$70,000\
\end{array}$
 What is the maximum amount that David can deduct in the current year as investment interest expense?

Accepted Answer

A) $7,000 
B) $20,000 
C) $21,000 
D) $24,000 
E) None of the above 
A) $7,000 
B) $20,000 
C) $21,000 
D) $24,000 
E) None of the above

Question 7

Jerry and Ann paid the following amounts during the current year: $$\begin{array} { l l } 
\text { Interest on automobile loan } & \$ 1,500 \
\text { Interest on bank loan (proceeds were used to purchase municipal bonds) } & \$ 5,000 \
\text { Qualified home mortgage interest } & \$ 3,150
\end{array}$$ What is the maximum amount they can use as interest expense in calculating itemized deductions for the current year?

Accepted Answer

A) $6,500 
B) $3,150 
C) $4,650 
D) $8,150 
E) None of the above 
A) $6,500 
B) $3,150 
C) $4,650 
D) $8,150 
E) None of the above

Question 8

In some cases, a taxpayer may deduct an otherwise allowable contribution to an IRA, even though the contribution is made after the close of the tax year.

Accepted Answer

A) True 
 B)False

Question 9

State sales taxes can be deducted in lieu of state income taxes.

Accepted Answer

A) True 
 B)False

Question 10

Debbie is 63 years old and retired in 2016.She receives Social Security payments of $12,000 a year and interest income of $30,000.She wishes to put the maximum allowed into an IRA.How much can she contribute to her IRA?

Accepted Answer

$0.She must have ear

Question 11

Ben is a 19-year-old single software inventor earning $200,000 a year and is not covered by a pension plan at work.How much can he put into a Roth IRA in 2018?

Accepted Answer

$0.He is over the in

Question 12

Which of the following charitable contributions is not tax deductible?

Accepted Answer

A) Cash donated to a qualified church. 
B) Clothing donated to a qualified veterans' organization. 
C) Time donated to a qualified veterans' organization. 
D) Donation of a car to a qualified nonprofit organization. 
E) All of the above are tax deductible. 
A) Cash donated to a qualified church. 
B) Clothing donated to a qualified veterans' organization. 
C) Time donated to a qualified veterans' organization. 
D) Donation of a car to a qualified nonprofit organization. 
E) All of the above are tax deductible.

Question 13

John is a single 40-year-old landscape architect earning $125,000 a year and is not covered by a pension plan at work.How much can he put into a Traditional IRA in 2018?

Accepted Answer

$5,500.He is not covered by a

Question 14

Which of the following statements is true about health savings accounts (HSAs)?

Accepted Answer

A) There is no restriction on the kind of health insurance taxpayers must carry in order to qualify for an HSA. 
B) Contributions to HSAs are not deductible for adjusted gross income (AGI), but are treated as an itemized deduction. 
C) Individuals taking distributions from HSAs which are not for medical expenses are subject to a 50 percent penalty. 
D) Distributions from HSAs are tax and penalty free when used for qualified medical expenses. 
E) Taxpayers may take tax and penalty free distributions from HSAs to purchase automobiles after age 65. 
A) There is no restriction on the kind of health insurance taxpayers must carry in order to qualify for an HSA. 
B) Contributions to HSAs are not deductible for adjusted gross income (AGI), but are treated as an itemized deduction. 
C) Individuals taking distributions from HSAs which are not for medical expenses are subject to a 50 percent penalty. 
D) Distributions from HSAs are tax and penalty free when used for qualified medical expenses. 
E) Taxpayers may take tax and penalty free distributions from HSAs to purchase automobiles after age 65.

Question 15

For 2018, Eugene and Linda had adjusted gross income of $30,000.Additional information for 2018 is as follows. $$\begin{array} { l r } 
\text { Cash contribution to church } & \$ 1,600 \
\text { Tuition paid to a parochial school } & \$ 1,200 \
\text { Contribution to a qualified charity } & \$ 400 \
\text { Cash contribution to a needy family } & \$ 100
\end{array}$$ What is the maximum amount they can deduct for charitable contributions in 2018?

Accepted Answer

A) $500 
B) $1,600 
C) $1,700 
D) $2,000 
E) None of the above 
A) $500 
B) $1,600 
C) $1,700 
D) $2,000 
E) None of the above

Question 16

Christine is a self-employed graphics artist who has net earned income of $160,000 from her business.Christine has a defined contribution SEP Plan and plans to contribute the amount that provides the maximum deduction allowable.How much can Christine contribute?

Accepted Answer

$32,000, the lesser

Question 17

Rob and Julie, both in their 30s, file a joint income tax return for 2018.Rob's wages are $25,000 and Julie's wages are $33,000 for the year.Their total adjusted gross income is $58,000, and Julie is covered by a qualified pension plan at work but Rob is not.​
a.What is the maximum amount that Rob and Julie may each contribute to their Roth IRAs?
b.​​​If Julie's wages are $110,000 for 2018, instead of $33,000, and their adjusted gross income is $135,000, (1) what is the maximum amount that Rob and Julie may each deduct for contributions to their traditional individual retirement accounts, and (2) what is the maximum amount they could each contribute to Roth IRAs instead?

Accepted Answer

a.  @#LAT-DLM&Rob @#LAT-DLM&.
 @#LAT-DLM& @#LAT-DLM&Julie @#LAT-DLM&.
b1 @#LAT-DLM& Rob @#LAT-DLM&,

Question 18

Jim lives in California.What is Jim's deadline for making a contribution to traditional IRA or a Roth IRA for 2018?

Accepted Answer

A) April 15, 2018 
B) December 31, 2018 
C) April 15, 2019 
D) October 15, 2019 
A) April 15, 2018 
B) December 31, 2018 
C) April 15, 2019 
D) October 15, 2019

Question 19

Melvin owns his home and has a $200,000 mortgage related to his purchase of the residence.In the fall of the current year, he borrows $40,000 on credit cards for college costs for his two sons.The interest expense on the mortgage is $15,000 and the interest expense on the credit cards is $6,000.How much of the interest is deductible as an itemized deduction and why?

Accepted Answer

Melvin's total interest deduction on Sch

Question 20

Charu is charged $70 by the state she lives in related to vehicle registration based on the weight of her personal auto.Charu can deduct the $70 as an itemized deduction.

Accepted Answer

A) True 
 B)False

A taxpayer may donate the free use of property to a charitable organization and deduct the value as an itemized deduction.

Amy paid the following interest expense during the current year: Qualified home mortgage interest \5 ,000 Credit card interest \1 ,000 Personal bank loan interest \3 ,000 What is the amount of Amy's interest deduction for the current year?

In 2018, the adjusted gross income (AGI)limitation on medical expenses is 15 percent.

In some cases, a taxpayer may deduct an otherwise allowable contribution to an IRA, even though the contribution is made after the close of the tax year.

State sales taxes can be deducted in lieu of state income taxes.

Debbie is 63 years old and retired in 2016.She receives Social Security payments of $12,000 a year and interest income of $30,000.She wishes to put the maximum allowed into an IRA.How much can she contribute to her IRA?

Ben is a 19-year-old single software inventor earning $200,000 a year and is not covered by a pension plan at work.How much can he put into a Roth IRA in 2018?

Which of the following charitable contributions is not tax deductible?

John is a single 40-year-old landscape architect earning $125,000 a year and is not covered by a pension plan at work.How much can he put into a Traditional IRA in 2018?

Which of the following statements is true about health savings accounts (HSAs)?

Christine is a self-employed graphics artist who has net earned income of $160,000 from her business.Christine has a defined contribution SEP Plan and plans to contribute the amount that provides the maximum deduction allowable.How much can Christine contribute?

Jim lives in California.What is Jim's deadline for making a contribution to traditional IRA or a Roth IRA for 2018?

Charu is charged $70 by the state she lives in related to vehicle registration based on the weight of her personal auto.Charu can deduct the $70 as an itemized deduction.

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

Filters

Exam 5: Deductions and Adjustments to Income

A taxpayer may donate the free use of property to a charitable organization and deduct the value as an itemized deduction.

Amy paid the following interest expense during the current year: Qualified home mortgage interest \5 ,000 Credit card interest \1 ,000 Personal bank loan interest \3 ,000 What is the amount of Amy's interest deduction for the current year?

In 2018, the adjusted gross income (AGI)limitation on medical expenses is 15 percent.

In some cases, a taxpayer may deduct an otherwise allowable contribution to an IRA, even though the contribution is made after the close of the tax year.

State sales taxes can be deducted in lieu of state income taxes.

Debbie is 63 years old and retired in 2016.She receives Social Security payments of $12,000 a year and interest income of $30,000.She wishes to put the maximum allowed into an IRA.How much can she contribute to her IRA?

Ben is a 19-year-old single software inventor earning $200,000 a year and is not covered by a pension plan at work.How much can he put into a Roth IRA in 2018?

Which of the following charitable contributions is not tax deductible?

John is a single 40-year-old landscape architect earning $125,000 a year and is not covered by a pension plan at work.How much can he put into a Traditional IRA in 2018?

Which of the following statements is true about health savings accounts (HSAs)?

Christine is a self-employed graphics artist who has net earned income of $160,000 from her business.Christine has a defined contribution SEP Plan and plans to contribute the amount that provides the maximum deduction allowable.How much can Christine contribute?

Jim lives in California.What is Jim's deadline for making a contribution to traditional IRA or a Roth IRA for 2018?

Charu is charged $70 by the state she lives in related to vehicle registration based on the weight of her personal auto.Charu can deduct the $70 as an itemized deduction.

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

Filters