Question 1

The term "tax law" includes

Accepted Answer

A)  Internal Revenue Code. 
B)  Treasury Regulations. 
C)  judicial decisions. 
D)  All of the above. 
A)  Internal Revenue Code. 
B)  Treasury Regulations. 
C)  judicial decisions. 
D)  All of the above. D

Question 2

Gifts made during a taxpayer's lifetime may affect the amount of estate tax paid by the taxpayer's estate.

Accepted Answer

A) True 
 B)False  True

Question 3

In an S corporation,shareholders

Accepted Answer

A)  are taxed on their proportionate share of earnings. 
B)  are taxed only on dividends. 
C)  may allocate income among themselves in order to consider special contributions. 
D)  are only taxed on salaries. 
A)  are taxed on their proportionate share of earnings. 
B)  are taxed only on dividends. 
C)  may allocate income among themselves in order to consider special contributions. 
D)  are only taxed on salaries. A

Question 4

All of the following statements are true except

Accepted Answer

A)  the net income earned by a sole proprietorship is reported on the owner's individual income tax return. 
B)  the net income of an S corporation is subject to double taxation because it is taxed at the entity level and dividends paid from the S corporation to individual shareholders are also taxed. 
C)  the net income of C corporation is subject to double taxation because it is taxed at the entity level and dividends paid from the C corporation to individual shareholders is also taxed. 
D)  LLCs are generally taxed as partnerships. 
A)  the net income earned by a sole proprietorship is reported on the owner's individual income tax return. 
B)  the net income of an S corporation is subject to double taxation because it is taxed at the entity level and dividends paid from the S corporation to individual shareholders are also taxed. 
C)  the net income of C corporation is subject to double taxation because it is taxed at the entity level and dividends paid from the C corporation to individual shareholders is also taxed. 
D)  LLCs are generally taxed as partnerships.

Question 5

Which of the following taxes is proportional?

Accepted Answer

A)  gift tax 
B)  income tax 
C)  sales tax 
D)  Federal Insurance Contributions Act (FIC
A)  
A)  gift tax 
B)  income tax 
C)  sales tax 
D)  Federal Insurance Contributions Act (FIC
A)

Question 6

Which of the following individuals is most likely to be audited?

Accepted Answer

A)  Lola has AGI of $35,000 from wages and uses the standard deduction. 
B)  Marvella has a $145,000 net loss from her unincorporated business (a horse farm). She also received $950,000 salary as a CEO of a corporation. 
C)  Melvin is retired and receives Social Security benefits. 
D)  Jerry is a school teacher with two children earning $55,000 a year. He also receives $200 in interest income on a bank account. 
A)  Lola has AGI of $35,000 from wages and uses the standard deduction. 
B)  Marvella has a $145,000 net loss from her unincorporated business (a horse farm). She also received $950,000 salary as a CEO of a corporation. 
C)  Melvin is retired and receives Social Security benefits. 
D)  Jerry is a school teacher with two children earning $55,000 a year. He also receives $200 in interest income on a bank account.

Question 7

What are the correct monthly rates for calculating failure to file and failure to pay penalties?

Accepted Answer

A)    
B)    
C)    
D)    
A)    
B)    
C)    
D)

Question 8

Larry and Ally are married and file a joint return.They are considering purchasing a personal residence that will generate two deductions: $10,000 in home mortgage interest and $8,000 in real estate taxes.Their marginal tax rate is 25%.If Larry and Ally purchase the residence,what will be the after-tax cost of the additional $18,000 in expenditures?

Accepted Answer

Tax savings of expenditures: (

Question 9

Describe the types of audits that the IRS conducts.

Accepted Answer

In an office audit,the taxpayer goes to

Question 10

In 2017,an estate is not taxable unless the sum of the taxable estate and taxable gifts made after 1976 exceeds

Accepted Answer

A)  $2,141,800. 
B)  $5,450,000. 
C)  $5,000,000. 
D)  $5,490,000. 
A)  $2,141,800. 
B)  $5,450,000. 
C)  $5,000,000. 
D)  $5,490,000.

Question 11

Regressive tax rates decrease as the tax base increases.

Accepted Answer

A) True 
 B)False

Question 12

Shaquille buys new cars for five of his friends.Each car cost $70,000.What is the amount of Shaquille's taxable gifts?

Accepted Answer

A)  $0 
B)  $280,000 
C)  $336,000 
D)  $350,000 
A)  $0 
B)  $280,000 
C)  $336,000 
D)  $350,000

Question 13

Paul makes the following property transfers in the current year:
• $22,000 cash to his wife
• $34,000 cash to a qualified charity
• $220,000 house to his son
• $3,000 computer to an unrelated friend
The total of Paul's taxable gifts,assuming he does not elect gift splitting with his spouse,subject to the unified transfer tax is

Accepted Answer

A)  $206,000. 
B)  $214,000. 
C)  $234,000. 
D)  $279,000. 
A)  $206,000. 
B)  $214,000. 
C)  $234,000. 
D)  $279,000.

Question 14

Horizontal equity means that

Accepted Answer

A)  taxpayers with the same amount of income should pay the same amount of tax. 
B)  taxpayers with larger amounts of income should pay more tax than taxpayers with lower amounts of income. 
C)  all taxpayers should pay the same tax. 
D)  None of the above. 
A)  taxpayers with the same amount of income should pay the same amount of tax. 
B)  taxpayers with larger amounts of income should pay more tax than taxpayers with lower amounts of income. 
C)  all taxpayers should pay the same tax. 
D)  None of the above.

Question 15

The primary objective of the federal income tax law is to achieve various economic and social policy objectives.

Accepted Answer

A) True 
 B)False

Question 16

Jeffery died in 2017 leaving a $16,000,000 gross estate.Six months after his death,the gross assets are valued at $16,100,000.In years prior to 2017 (but after 1976),Jeffery had made taxable gifts of $300,000.Of the $16,000,000 gross estate,estate assets valued at $3 million were transferred to his wife and $100,000 was used to pay administrative and funeral expenses.Jeffery had debts of $200,000,and the remainder of the estate was transferred to his children.
a.What is the amount of Jeffery's taxable estate?
b.What is the tax base for computing Jeffery's estate?
c.What is the amount of estate tax owed if the unified credit is $2,141,800?
d.Alternatively,if six months after his death,the gross assets in Jeffery's estate declined in value to $15,000,000,can the administrator of Jeffery's estate elect the alternate valuation date?

Accepted Answer

@#IMG-DLM& d.The alternate valuation date (six mon

Question 17

The IRS must pay interest on

Accepted Answer

A)  all tax refunds. 
B)  tax refunds paid later than 30 days after the due date. 
C)  tax refunds paid later than 45 days after the due date. 
D)  The IRS never pays interest on tax refunds. 
A)  all tax refunds. 
B)  tax refunds paid later than 30 days after the due date. 
C)  tax refunds paid later than 45 days after the due date. 
D)  The IRS never pays interest on tax refunds.

Question 18

Describe the components of tax practice.

Accepted Answer

a.Tax compliance and procedure

Question 19

Generally,the statute of limitations is three years from the later of the date the tax return is filed or the due date.

Accepted Answer

A) True 
 B)False

Question 20

The largest source of federal revenues is the corporate income tax.

Accepted Answer

A) True 
 B)False

The term "tax law" includes

Gifts made during a taxpayer's lifetime may affect the amount of estate tax paid by the taxpayer's estate.

In an S corporation,shareholders

All of the following statements are true except

Which of the following taxes is proportional?

Which of the following individuals is most likely to be audited?

What are the correct monthly rates for calculating failure to file and failure to pay penalties?

Describe the types of audits that the IRS conducts.

In 2017,an estate is not taxable unless the sum of the taxable estate and taxable gifts made after 1976 exceeds

Regressive tax rates decrease as the tax base increases.

Shaquille buys new cars for five of his friends.Each car cost $70,000.What is the amount of Shaquille's taxable gifts?

Horizontal equity means that

The primary objective of the federal income tax law is to achieve various economic and social policy objectives.

The IRS must pay interest on

Describe the components of tax practice.

Generally,the statute of limitations is three years from the later of the date the tax return is filed or the due date.

The largest source of federal revenues is the corporate income tax.

Determination of Tax

Gross Income: Inclusions

Gross Income: Exclusions

Property Transactions: Capital Gains and Losses

Deductions and Losses

Itemized Deductions

Losses and Bad Debts

Employee Expenses and Deferred Compensation

Depreciation, cost Recovery, amortization, and Depletion

Accounting Periods and Methods

Property Transactions: Nontaxable Exchanges

Property Transactions: Sec1231 and Recapture

Special Tax Computation Methods, tax Credits, and Payment of Tax

Tax Research

Corporations

Partnerships and S Corporations

Taxes and Investment Planning

Filters

Exam 1: An Introduction to Taxation

The term "tax law" includes

Gifts made during a taxpayer's lifetime may affect the amount of estate tax paid by the taxpayer's estate.

In an S corporation,shareholders

All of the following statements are true except

Which of the following taxes is proportional?

Which of the following individuals is most likely to be audited?

What are the correct monthly rates for calculating failure to file and failure to pay penalties?

Describe the types of audits that the IRS conducts.

In 2017,an estate is not taxable unless the sum of the taxable estate and taxable gifts made after 1976 exceeds

Regressive tax rates decrease as the tax base increases.

Shaquille buys new cars for five of his friends.Each car cost $70,000.What is the amount of Shaquille's taxable gifts?

Horizontal equity means that

The primary objective of the federal income tax law is to achieve various economic and social policy objectives.

The IRS must pay interest on

Describe the components of tax practice.

Generally,the statute of limitations is three years from the later of the date the tax return is filed or the due date.

The largest source of federal revenues is the corporate income tax.

Determination of Tax

Gross Income: Inclusions

Gross Income: Exclusions

Property Transactions: Capital Gains and Losses

Deductions and Losses

Itemized Deductions

Losses and Bad Debts

Employee Expenses and Deferred Compensation

Depreciation, cost Recovery, amortization, and Depletion

Accounting Periods and Methods

Property Transactions: Nontaxable Exchanges

Property Transactions: Sec1231 and Recapture

Special Tax Computation Methods, tax Credits, and Payment of Tax

Tax Research

Corporations

Partnerships and S Corporations

Taxes and Investment Planning

Filters