Question 1

For tax purposes,income is recognized if the transaction meets three conditions: economic benefit,occurrence and completion,and not exempt from tax.

Accepted Answer

A) True 
 B)False

Question 2

Corporate and mutual fund payers are required to provide shareholders a Form ________ that indicates the amount of dividends in box 1a.

Accepted Answer

A) 1099-DVI 
B) 1098-DIV 
C) 1098-INT 
D) 1099-DIV 
A) 1099-DVI 
B) 1098-DIV 
C) 1098-INT 
D) 1099-DIV

Question 3

When is an original issue discount OID)created? How is the initial OID computed?

Accepted Answer

An original issue discount OID)is create

Question 4

Ruth,who files as head of household,reported itemized deductions of $9,350 on her 2015 tax return.Her itemized deductions included $300 of state taxes paid.In 2016,she received a $175 refund of state taxes paid in 2015.What is the amount that Ruth needs to report on her 2016 tax return?

Accepted Answer

A) $0. 
B) $100. 
C) $175. 
D) $300. 
A) $0. 
B) $100. 
C) $175. 
D) $300.

Question 5

What item should not be included in income?

Accepted Answer

A) Sick pay. 
B) Jury duty pay. 
C) Prizes and awards. 
D) Worker's compensation payments. 
A) Sick pay. 
B) Jury duty pay. 
C) Prizes and awards. 
D) Worker's compensation payments.

Question 6

What is the tax liability for a single individual who has taxable income of $115,500,that includes a taxable qualified dividend of $2,000? All answers should be rounded to the nearest dollar.

Accepted Answer

A) $24,817. 
B) $32,411. 
C) $25,377. 
D) $25,117. 
A) $24,817. 
B) $32,411. 
C) $25,377. 
D) $25,117.

Question 7

Imputed interest rules do not apply to the following:

Accepted Answer

A) Sale of a farm for $1 million or less. 
B) Sale of property for $3,000 or less. 
C) Sale of a personal residence. 
D) Both sale of property for $3,000 or less and sale of a personal residence. 
A) Sale of a farm for $1 million or less. 
B) Sale of property for $3,000 or less. 
C) Sale of a personal residence. 
D) Both sale of property for $3,000 or less and sale of a personal residence.

Question 8

Under the cash receipts and disbursements method,the taxpayer reports income in the year:

Accepted Answer

A) Income is received. 
B) Income is earned. 
C) Income is accrued. 
D) Income is negotiated. 
A) Income is received. 
B) Income is earned. 
C) Income is accrued. 
D) Income is negotiated.

Question 9

Income can only be realized in money or services.

Accepted Answer

A) True 
 B)False

Question 10

Does forgiveness of a loan repayment by the lender represent income to the borrower?

Accepted Answer

Yes,the borrower must report income.The

Question 11

Discounts offered to employees on services cannot exceed ________ of the normal selling price.

Accepted Answer

A) 75% 
B) 10% 
C) 5% 
D) 20% 
A) 75% 
B) 10% 
C) 5% 
D) 20%

Question 12

Constructive receipt means the taxpayer has:

Accepted Answer

A) Earned the income and accrued the income. 
B) Earned the income. 
C) Accrued the income. 
D) Control of the income for his or her use. 
A) Earned the income and accrued the income. 
B) Earned the income. 
C) Accrued the income. 
D) Control of the income for his or her use.

Question 13

Define constructive receipt.

Accepted Answer

Constructive receipt means that the inco

Question 14

Employers can reimburse employees for up to per year of educational assistance,whether or not job-related.

Accepted Answer

A) $5,520 
B) $5,150 
C) $5,250 
D) $5,000 
A) $5,520 
B) $5,150 
C) $5,250 
D) $5,000

Question 15

How does the taxpayer report interest income on an original issue discount OID)instrument?

Accepted Answer

The taxpayer must include part of the OI

Question 16

Tax-exempt interest includes the following items,except:

Accepted Answer

A) interest on bonds issued by the local government to build a convention center. 
B) interest on municipal bonds. 
C) interest on bonds issued by any state. 
D) interest on bonds issued by the District of Columbia. 
A) interest on bonds issued by the local government to build a convention center. 
B) interest on municipal bonds. 
C) interest on bonds issued by any state. 
D) interest on bonds issued by the District of Columbia.

Question 17

Employer-paid premiums on life insurance are not taxable to the employees,unless the coverage is in excess of ________.

Accepted Answer

A) $50,000 
B) $5,000 
C) $5,250 
D) $51,000 
A) $50,000 
B) $5,000 
C) $5,250 
D) $51,000

Question 18

The imputed interest rules do not apply to the following:

Accepted Answer

A) Sales of property for $3,000 or less. 
B) Certain carrying charges. 
C) Sales in which all payments are due in 6 months or less. 
D) All of these. 
A) Sales of property for $3,000 or less. 
B) Certain carrying charges. 
C) Sales in which all payments are due in 6 months or less. 
D) All of these.

Question 19

Corporate distributions to shareholders that represent a nontaxable return of capital are those that are:

Accepted Answer

A) made from the excess over earnings and profits of the corporation. 
B) made from the bank account of the corporation. 
C) made from accumulated retained earnings of the corporation. 
D) made from current year's profit of the corporation. 
A) made from the excess over earnings and profits of the corporation. 
B) made from the bank account of the corporation. 
C) made from accumulated retained earnings of the corporation. 
D) made from current year's profit of the corporation.

Question 20

Under the cash method,an individual reports income when:

Accepted Answer

A) income is received or earned. 
B) income is accrued. 
C) income is earned. 
D) income is received or constructively received. 
A) income is received or earned. 
B) income is accrued. 
C) income is earned. 
D) income is received or constructively received.

For tax purposes,income is recognized if the transaction meets three conditions: economic benefit,occurrence and completion,and not exempt from tax.

Corporate and mutual fund payers are required to provide shareholders a Form ________ that indicates the amount of dividends in box 1a.

When is an original issue discount OID)created? How is the initial OID computed?

Ruth,who files as head of household,reported itemized deductions of $9,350 on her 2015 tax return.Her itemized deductions included $300 of state taxes paid.In 2016,she received a $175 refund of state taxes paid in 2015.What is the amount that Ruth needs to report on her 2016 tax return?

What item should not be included in income?

What is the tax liability for a single individual who has taxable income of $115,500,that includes a taxable qualified dividend of $2,000? All answers should be rounded to the nearest dollar.

Imputed interest rules do not apply to the following:

Under the cash receipts and disbursements method,the taxpayer reports income in the year:

Income can only be realized in money or services.

Does forgiveness of a loan repayment by the lender represent income to the borrower?

Discounts offered to employees on services cannot exceed ________ of the normal selling price.

Constructive receipt means the taxpayer has:

Define constructive receipt.

Employers can reimburse employees for up to per year of educational assistance,whether or not job-related.

How does the taxpayer report interest income on an original issue discount OID)instrument?

Tax-exempt interest includes the following items,except:

Employer-paid premiums on life insurance are not taxable to the employees,unless the coverage is in excess of ________.

The imputed interest rules do not apply to the following:

Corporate distributions to shareholders that represent a nontaxable return of capital are those that are:

Under the cash method,an individual reports income when:

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

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

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

Retirement and Other Tax-Deferred Plans and Annuities

Special Property Transactions

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

Partnership Taxation

Corporate Taxation

Filters

Exam 3: Gross Income: Inclusions and Exclusions

For tax purposes,income is recognized if the transaction meets three conditions: economic benefit,occurrence and completion,and not exempt from tax.

Corporate and mutual fund payers are required to provide shareholders a Form ________ that indicates the amount of dividends in box 1a.

When is an original issue discount OID)created? How is the initial OID computed?

Ruth,who files as head of household,reported itemized deductions of $9,350 on her 2015 tax return.Her itemized deductions included $300 of state taxes paid.In 2016,she received a $175 refund of state taxes paid in 2015.What is the amount that Ruth needs to report on her 2016 tax return?

What item should not be included in income?

What is the tax liability for a single individual who has taxable income of $115,500,that includes a taxable qualified dividend of $2,000? All answers should be rounded to the nearest dollar.

Imputed interest rules do not apply to the following:

Under the cash receipts and disbursements method,the taxpayer reports income in the year:

Income can only be realized in money or services.

Does forgiveness of a loan repayment by the lender represent income to the borrower?

Discounts offered to employees on services cannot exceed ________ of the normal selling price.

Constructive receipt means the taxpayer has:

Define constructive receipt.

Employers can reimburse employees for up to per year of educational assistance,whether or not job-related.

How does the taxpayer report interest income on an original issue discount OID)instrument?

Tax-exempt interest includes the following items,except:

Employer-paid premiums on life insurance are not taxable to the employees,unless the coverage is in excess of ________.

The imputed interest rules do not apply to the following:

Corporate distributions to shareholders that represent a nontaxable return of capital are those that are:

Under the cash method,an individual reports income when:

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

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

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

Retirement and Other Tax-Deferred Plans and Annuities

Special Property Transactions

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

Partnership Taxation

Corporate Taxation

Filters