Question 1

Which of the following statements is correct?

Accepted Answer

A) All of the statements are correct. 
B) Individuals or companies usually establish a pension plan with a trustee. 
C) Retirement plans are generally not tax-free,only tax-deferred. 
D) In part,Congress established pension plan rules to encourage individuals to save for retirement. 
A) All of the statements are correct. 
B) Individuals or companies usually establish a pension plan with a trustee. 
C) Retirement plans are generally not tax-free,only tax-deferred. 
D) In part,Congress established pension plan rules to encourage individuals to save for retirement.

Question 2

Which of the following statements regarding Individual Retirement Accounts IRA)is incorrect?

Accepted Answer

A) Contributions to a conventional IRA may be tax-deductible while contributions to a Roth IRA are never tax-deductible. 
B) Because IRA contributions are based on compensation,a non-working spouse cannot make a contribution to an IRA. 
C) Once a taxpayer reaches age 70½,deductible contributions cannot be made to a conventional IRA. 
D) Excess contributions to an IRA are subject to an excise tax. 
A) Contributions to a conventional IRA may be tax-deductible while contributions to a Roth IRA are never tax-deductible. 
B) Because IRA contributions are based on compensation,a non-working spouse cannot make a contribution to an IRA. 
C) Once a taxpayer reaches age 70½,deductible contributions cannot be made to a conventional IRA. 
D) Excess contributions to an IRA are subject to an excise tax.

Question 3

Valerie and Marty are both age 51 and file a joint return.They have one child who is age 17.They have combined AGI in 2016 of $180,000.What is their maximum permitted contribution to a Coverdell Education Savings Account for 2016 assuming no other persons make contributions?

Accepted Answer

A) $2,000. 
B) $0. 
C) $5,500. 
D) $6,500. 
A) $2,000. 
B) $0. 
C) $5,500. 
D) $6,500.

Question 4

Which of the following statements is incorrect?

Accepted Answer

A) For traditional IRA distributions,the date on which minimum payments must begin is April 1 of the calendar year following the year in which the taxpayer reaches age 70½. 
B) Taxpayers can roll over plan assets from one plan to another tax-free if certain rules are followed. 
C) Roth IRA distributions are never taxable. 
D) If distributions from a Coverdell Education Savings Account are used for qualified education expenses,the distributions are tax-free. 
A) For traditional IRA distributions,the date on which minimum payments must begin is April 1 of the calendar year following the year in which the taxpayer reaches age 70½. 
B) Taxpayers can roll over plan assets from one plan to another tax-free if certain rules are followed. 
C) Roth IRA distributions are never taxable. 
D) If distributions from a Coverdell Education Savings Account are used for qualified education expenses,the distributions are tax-free.

Question 5

What are some tax consequences related to a qualified pension plan?

Accepted Answer

A) Employer contributions are deductible when made. 
B) Employees are not taxed until distributions are received from the plan. 
C) Earnings on the contributions are taxable to the employee as they are earned. 
D) Employer contributions are deductible when made and employees are not taxed until distributions are received from the plan. 
A) Employer contributions are deductible when made. 
B) Employees are not taxed until distributions are received from the plan. 
C) Earnings on the contributions are taxable to the employee as they are earned. 
D) Employer contributions are deductible when made and employees are not taxed until distributions are received from the plan.

Question 6

In 2016,the maximum annual contribution to a SIMPLE pension plan for an employee under the age of 50 is:

Accepted Answer

A) $12,500 
B) $53,000 
C) $18,000 
D) $5,500 
A) $12,500 
B) $53,000 
C) $18,000 
D) $5,500

Question 7

There are two types of IRAs: a traditional IRA and a Roth IRA.

Accepted Answer

A) True 
 B)False

Question 8

Individuals age 50 or older can make greater annual contributions to an IRA.

Accepted Answer

A) True 
 B)False

Question 9

Distributions from a Coverdell Education Savings Account are tax-free to the beneficiary if they are used for his or her qualified education expenses.

Accepted Answer

A) True 
 B)False

Question 10

Shauntae is 75 years old.He purchased a single life annuity contract that will pay him $3,000 per month for 10 years.The expected return under the contract is:

Accepted Answer

A) $482,400. 
B) $450,000. 
C) $360,000. 
D) $30,000. 
A) $482,400. 
B) $450,000. 
C) $360,000. 
D) $30,000.

Question 11

Patrick is age 30,single,and has AGI of $101,000.He would like to contribute to a Coverdell Education Savings Account CESA)for his niece,Eileen.What is the maximum CESA contribution Patrick can make for Eileen in 2016?

Accepted Answer

A) $2,000. 
B) $1,500. 
C) $0. 
D) $1,200. 
A) $2,000. 
B) $1,500. 
C) $0. 
D) $1,200.

Question 12

Len is entitled to receive monthly payments of $1,500 over his life from his employer's qualified pension plan.The payments begin January 1,2016.He contributed $71,500 to the plan prior to his retirement at age 62.Using the simplified method,how much of the payments will be included in Len's taxable income for 2016?

Accepted Answer

A) $14,700. 
B) $0. 
C) $3,300. 
D) $18,000. 
A) $14,700. 
B) $0. 
C) $3,300. 
D) $18,000.

Question 13

In 2016,a 48-year-old participant in a 401k)plan may contribute a maximum of:

Accepted Answer

A) $23,000. 
B) $12,500. 
C) $5,500. 
D) $18,000. 
A) $23,000. 
B) $12,500. 
C) $5,500. 
D) $18,000.

Question 14

Annually,up to $2,000 per beneficiary can be contributed to a Coverdell Education Savings Account.

Accepted Answer

A) True 
 B)False

Question 15

Tax-deferred plans are only available for purposes of saving for retirement.

Accepted Answer

A) True 
 B)False

Question 16

The expected return on an annuity contract that will last for a specified amount of time is determined with reference to the life expectancy tables published by the IRS.

Accepted Answer

A) True 
 B)False

Question 17

Charlotte is age 52,married,and reported AGI of $102,000 in tax year 2016.She is an active participant in her employer's pension plan.What is the disallowed portion of her deductible IRA contribution in 2016?

Accepted Answer

A) $1,100. 
B) $1,000. 
C) $5,200. 
D) $1,300. 
A) $1,100. 
B) $1,000. 
C) $5,200. 
D) $1,300.

Question 18

Regarding a Coverdell Education Savings Account:

Accepted Answer

A) Distributions are tax-free to the beneficiary if they are used for his or her qualified education expenses. 
B) Qualified expenses must be reduced by scholarships or other tax-free income. 
C) Qualified education expenses include required tuition,fees,books,supplies,and equipment at an eligible educational institution. 
D) All of these. 
A) Distributions are tax-free to the beneficiary if they are used for his or her qualified education expenses. 
B) Qualified expenses must be reduced by scholarships or other tax-free income. 
C) Qualified education expenses include required tuition,fees,books,supplies,and equipment at an eligible educational institution. 
D) All of these.

Question 19

Habiba is age 74 and married.Her husband is age 73.She purchased a single life annuity contract that will pay her $20,000 per year for life.The expected return on the contract is

Accepted Answer

A) $278,000. 
B) $264,000. 
C) $282,000. 
D) $476,000. 
A) $278,000. 
B) $264,000. 
C) $282,000. 
D) $476,000.

Question 20

Benjamin and Ester file a joint return and have AGI of $165,000.Both are active participants in their employer's pension plan.They have one child,Emily,who is age 8.Emily's grandparents contributed $1,000 to a Coverdell Education Savings Account for Emily in 2016.What is the maximum permitted Coverdell Education Savings Account contribution that Benjamin and Ester can make in 2016?

Accepted Answer

A) $5,500. 
B) $1,000. 
C) $2,000. 
D) $0. 
A) $5,500. 
B) $1,000. 
C) $2,000. 
D) $0.

Which of the following statements is correct?

Which of the following statements regarding Individual Retirement Accounts IRA)is incorrect?

Valerie and Marty are both age 51 and file a joint return.They have one child who is age 17.They have combined AGI in 2016 of $180,000.What is their maximum permitted contribution to a Coverdell Education Savings Account for 2016 assuming no other persons make contributions?

Which of the following statements is incorrect?

What are some tax consequences related to a qualified pension plan?

In 2016,the maximum annual contribution to a SIMPLE pension plan for an employee under the age of 50 is:

There are two types of IRAs: a traditional IRA and a Roth IRA.

Individuals age 50 or older can make greater annual contributions to an IRA.

Distributions from a Coverdell Education Savings Account are tax-free to the beneficiary if they are used for his or her qualified education expenses.

Shauntae is 75 years old.He purchased a single life annuity contract that will pay him $3,000 per month for 10 years.The expected return under the contract is:

Patrick is age 30,single,and has AGI of $101,000.He would like to contribute to a Coverdell Education Savings Account CESA)for his niece,Eileen.What is the maximum CESA contribution Patrick can make for Eileen in 2016?

In 2016,a 48-year-old participant in a 401k)plan may contribute a maximum of:

Annually,up to $2,000 per beneficiary can be contributed to a Coverdell Education Savings Account.

Tax-deferred plans are only available for purposes of saving for retirement.

The expected return on an annuity contract that will last for a specified amount of time is determined with reference to the life expectancy tables published by the IRS.

Charlotte is age 52,married,and reported AGI of $102,000 in tax year 2016.She is an active participant in her employer's pension plan.What is the disallowed portion of her deductible IRA contribution in 2016?

Regarding a Coverdell Education Savings Account:

Habiba is age 74 and married.Her husband is age 73.She purchased a single life annuity contract that will pay her $20,000 per year for life.The expected return on the contract is

Introduction to Taxation, the Income Tax Formula, and Form 1040ez

Expanded Tax Formula, forms 1040a and 1040, and Basic Concepts

Gross Income: Inclusions and Exclusions

Adjustments for Adjusted Gross Income

Itemized Deductions

Self-Employed Business Income Line 12 of Form 1040 and Schedule C

Capital Gains and Other Sales of Property Schedule D and Form 4797

Rental Property, royalties, and Income From Flow-Through Entities Line 17, form 1040, and Schedule E

Tax Credits Form 1040, lines 46 Through 54 and Lines 66a Through 73

Payroll Taxes

Special Property Transactions

At-Riskpassive Activity Loss Rules and the Individual Alternative Minimum Tax

Partnership Taxation

Corporate Taxation

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Exam 11: Retirement and Other Tax-Deferred Plans and Annuities

Which of the following statements is correct?

Which of the following statements regarding Individual Retirement Accounts IRA)is incorrect?

Valerie and Marty are both age 51 and file a joint return.They have one child who is age 17.They have combined AGI in 2016 of $180,000.What is their maximum permitted contribution to a Coverdell Education Savings Account for 2016 assuming no other persons make contributions?

Which of the following statements is incorrect?

What are some tax consequences related to a qualified pension plan?

In 2016,the maximum annual contribution to a SIMPLE pension plan for an employee under the age of 50 is:

There are two types of IRAs: a traditional IRA and a Roth IRA.

Individuals age 50 or older can make greater annual contributions to an IRA.

Distributions from a Coverdell Education Savings Account are tax-free to the beneficiary if they are used for his or her qualified education expenses.

Shauntae is 75 years old.He purchased a single life annuity contract that will pay him $3,000 per month for 10 years.The expected return under the contract is:

Patrick is age 30,single,and has AGI of $101,000.He would like to contribute to a Coverdell Education Savings Account CESA)for his niece,Eileen.What is the maximum CESA contribution Patrick can make for Eileen in 2016?

In 2016,a 48-year-old participant in a 401k)plan may contribute a maximum of:

Annually,up to $2,000 per beneficiary can be contributed to a Coverdell Education Savings Account.

Tax-deferred plans are only available for purposes of saving for retirement.

The expected return on an annuity contract that will last for a specified amount of time is determined with reference to the life expectancy tables published by the IRS.

Charlotte is age 52,married,and reported AGI of $102,000 in tax year 2016.She is an active participant in her employer's pension plan.What is the disallowed portion of her deductible IRA contribution in 2016?

Regarding a Coverdell Education Savings Account:

Habiba is age 74 and married.Her husband is age 73.She purchased a single life annuity contract that will pay her $20,000 per year for life.The expected return on the contract is

Introduction to Taxation, the Income Tax Formula, and Form 1040ez

Expanded Tax Formula, forms 1040a and 1040, and Basic Concepts

Gross Income: Inclusions and Exclusions

Adjustments for Adjusted Gross Income

Itemized Deductions

Self-Employed Business Income Line 12 of Form 1040 and Schedule C

Capital Gains and Other Sales of Property Schedule D and Form 4797

Rental Property, royalties, and Income From Flow-Through Entities Line 17, form 1040, and Schedule E

Tax Credits Form 1040, lines 46 Through 54 and Lines 66a Through 73

Payroll Taxes

Special Property Transactions

At-Riskpassive Activity Loss Rules and the Individual Alternative Minimum Tax

Partnership Taxation

Corporate Taxation

Filters