Question 1

Match the statements that relate to each other.(Note: Choice L may be used more than once.)

Accepted Answer

Automatic

Question 2

Faith just graduated from college and she needs advice on the tax treatment of the costs she incurs in connection with her first job (a loan officer at a bank).Specifically, she wants to know about the following items:

Accepted Answer

The answer of Faith just graduated from college and she...

Question 3

Under the actual cost method, which, if any, of the following expenses will not be allowed?

Accepted Answer

A) Car registration fees. 
B) Auto insurance. 
C) Interest expense on a car loan (taxpayer is an employee). 
D) Dues to auto clubs. 
E) None of the above. 
A) Car registration fees. 
B) Auto insurance. 
C) Interest expense on a car loan (taxpayer is an employee). 
D) Dues to auto clubs. 
E) None of the above.

Question 4

In which, if any, of the following situations is the automatic mileage available?

Accepted Answer

A) A limousine to be rented by the owner for special occasions (e.g., weddings, high school proms). 
B) The auto belongs to taxpayer's mother. 
C) One of seven cars used to deliver pizzas. 
D) MACRS statutory percentage method has not been claimed on the automobile. 
E) None of the above. 
A) A limousine to be rented by the owner for special occasions (e.g., weddings, high school proms). 
B) The auto belongs to taxpayer's mother. 
C) One of seven cars used to deliver pizzas. 
D) MACRS statutory percentage method has not been claimed on the automobile. 
E) None of the above.

Question 5

Ashley and Matthew are husband and wife and both are practicing CPAs.On a joint return, Ashley gets to deduct her professional dues but Matthew does not.Explain.

Accepted Answer

Most likely Ashley is self-employed, whi

Question 6

During the year, Walt went from Louisville to Hawaii on business.Preceding a five-day business meeting, he spent four days vacationing at the beach.Excluding the vacation costs, his expenses for the trip are:   Presuming no reimbursement, deductible expenses are:

Accepted Answer

A) $5,500. 
B) $4,800. 
C) $3,900. 
D) $3,200. 
E) None of the above. 
A) $5,500. 
B) $4,800. 
C) $3,900. 
D) $3,200. 
E) None of the above.

Question 7

A participant, who is age 38, in a cash or deferred arrangement plan [§ 401(k)] may contribute up to what amount in 2012?

Accepted Answer

A) $12,000. 
B) $16,500. 
C) $17,000. 
D) $17,500. 
E) None of the above. 
A) $12,000. 
B) $16,500. 
C) $17,000. 
D) $17,500. 
E) None of the above.

Question 8

One indicia of independent contractor (rather than employee) status is when the individual performing the services is paid based on time spent (rather than on tasks performed).

Accepted Answer

A) True 
 B)False

Question 9

A taxpayer who claims the standard deduction will not be able to claim an office in the home deduction.

Accepted Answer

A) True 
 B)False

Question 10

In some cases it may be appropriate for a taxpayer to report work-related expenses by using both Form 2106 and Schedule
C.

Accepted Answer

A) True 
 B)False

Question 11

Amy lives and works in St.Louis.In the morning she flies to Boston, has a three-hour business meeting, and returns to St.Louis that evening.For tax purposes, Amy was away from home.

Accepted Answer

A) True 
 B)False

Question 12

Regarding tax favored retirement plans for employees and self-employed persons, comment on the following:

Accepted Answer

The answer of Regarding tax favored retirement plans for employees...

Question 13

Under the right circumstances, a taxpayer's meals and lodging expense can qualify as a deductible education expense.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following expenses, if any, qualify as deductible?

Accepted Answer

A) Contributions to a Coverdell Education Savings Account (CES
A) . 
B) Contributions to a qualified tuition program (§ 529 plan). 
C) Job hunting expense of FBI agent who applies for the job of city manager of Beaumont (TX). 
D) Contribution to a traditional IRA. 
E) None of the above. 
A) Contributions to a Coverdell Education Savings Account (CES
A) . 
B) Contributions to a qualified tuition program (§ 529 plan). 
C) Job hunting expense of FBI agent who applies for the job of city manager of Beaumont (TX). 
D) Contribution to a traditional IRA. 
E) None of the above.

Question 15

In connection with the office in the home deduction, comment on the following:

Accepted Answer

The answer of In connection with the office in the...

Question 16

Both traditional and Roth IRAs possess the advantage of tax-free accumulation of income within the plan.

Accepted Answer

A) True 
 B)False

Question 17

Which, if any, of the following expenses is subject to the 2%-of-AGI floor?

Accepted Answer

A) Gambling losses (to the extent of gambling gains). 
B) Moving expenses (not reimbursed by employer). 
C) Teaching supplies (in excess of $250) purchased by a fifth grade teacher. 
D) Union dues of self-employed machinist. 
E) None of the above. 
A) Gambling losses (to the extent of gambling gains). 
B) Moving expenses (not reimbursed by employer). 
C) Teaching supplies (in excess of $250) purchased by a fifth grade teacher. 
D) Union dues of self-employed machinist. 
E) None of the above.

Question 18

Aiden is the city sales manager for "Wings," a national fast food franchise.Every working day, Aiden drives his car as follows:   Aiden's deductible mileage is:

Accepted Answer

A) 0 miles. 
B) 30 miles. 
C) 46 miles. 
D) 76 miles. 
E) None of the above. 
A) 0 miles. 
B) 30 miles. 
C) 46 miles. 
D) 76 miles. 
E) None of the above.

Question 19

Lloyd, a practicing CPA, pays tuition to attend law school. Since a law degree involves education leading to a new trade or business, the tuition is not deductible.

Accepted Answer

A) True 
 B)False

Question 20

Cathy takes five key clients to a nightclub and incurs the following costs: $320 limousine rental, $460 cover charge, $920 drinks and dinner, and $200 tips.Several days after the function, Cathy mails each client a pen costing $25.To the cost must be added $4 for engraving of the client's name.Assuming adequate substantiation and a business justification, what is Cathy's deduction?

Accepted Answer

$1,255.$320 + [($460 + $920 +

Exam 9: Deductions: Employee and Self-Employed-Related Expenses

Match the statements that relate to each other.(Note: Choice L may be used more than once.)

Faith just graduated from college and she needs advice on the tax treatment of the costs she incurs in connection with her first job (a loan officer at a bank).Specifically, she wants to know about the following items:

Under the actual cost method, which, if any, of the following expenses will not be allowed?

In which, if any, of the following situations is the automatic mileage available?

Ashley and Matthew are husband and wife and both are practicing CPAs.On a joint return, Ashley gets to deduct her professional dues but Matthew does not.Explain.

During the year, Walt went from Louisville to Hawaii on business.Preceding a five-day business meeting, he spent four days vacationing at the beach.Excluding the vacation costs, his expenses for the trip are: Presuming no reimbursement, deductible expenses are:

A participant, who is age 38, in a cash or deferred arrangement plan [§ 401(k)] may contribute up to what amount in 2012?

One indicia of independent contractor (rather than employee) status is when the individual performing the services is paid based on time spent (rather than on tasks performed).

A taxpayer who claims the standard deduction will not be able to claim an office in the home deduction.

In some cases it may be appropriate for a taxpayer to report work-related expenses by using both Form 2106 and Schedule C.

Amy lives and works in St.Louis.In the morning she flies to Boston, has a three-hour business meeting, and returns to St.Louis that evening.For tax purposes, Amy was away from home.

Regarding tax favored retirement plans for employees and self-employed persons, comment on the following:

Under the right circumstances, a taxpayer's meals and lodging expense can qualify as a deductible education expense.

Which of the following expenses, if any, qualify as deductible?

In connection with the office in the home deduction, comment on the following:

Both traditional and Roth IRAs possess the advantage of tax-free accumulation of income within the plan.

Which, if any, of the following expenses is subject to the 2%-of-AGI floor?

Aiden is the city sales manager for "Wings," a national fast food franchise.Every working day, Aiden drives his car as follows: Aiden's deductible mileage is:

Lloyd, a practicing CPA, pays tuition to attend law school. Since a law degree involves education leading to a new trade or business, the tuition is not deductible.

An Introduction to Taxation and Understanding the Federal Tax Law

Working With the Tax Law

Computing the Tax

Gross Income: Concepts and Inclusions

Gross Income: Exclusions

Deductions and Losses: in General

Deductions and Losses: Certain Business Expenses and Losses

Depreciation, Cost Recovery, Amortization, and Depletion

Deductions and Losses: Certain Itemized Deductions

Investor Losses

Tax Credits and Payments

Property Transactions: Determination of Gain or Loss, Basis Considerations, and Nontaxable Exchanges-Part 1

Property Transactions: Determination of Gain or Loss, Basis Considerations, and Nontaxable Exchanges-Part 2

Property Transactions: Capital Gains and Losses, 1231, Recapture Provisions

Alternative Minimum Tax

Accounting Periods and Methods

Corporations: Introduction and Operating Rules

Corporations: Organization and Capital Structure

Corporations: Distributions Not in Complete Liquidation

Corporations: Distributions in Complete Liquidation and an Overview of Reorganizations

Partnerships

S: Corporations

Exempt Entities

Multistate Corporate Taxation

Taxation of International Transactions

Tax Practice and Ethics

Income Taxation of Trusts and Estates

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