Question 1

What is the definition of a proportional tax?

Accepted Answer

A proportional tax is a tax where the tax rate remains the same regardless of the tax base.

Question 2

With respect to the income tax formula,which of the following statements is correct?

Accepted Answer

A) It is almost always the case that the tax return will either show a tax refund or an additional tax liability. 
B) Tax credits are not used when making tax liability calculations. 
C) Total income and taxable income are the same number. 
D) Taxable income is multiplied by a single tax rate to determine tax liability. 
A) It is almost always the case that the tax return will either show a tax refund or an additional tax liability. 
B) Tax credits are not used when making tax liability calculations. 
C) Total income and taxable income are the same number. 
D) Taxable income is multiplied by a single tax rate to determine tax liability. A

Question 3

Circular 230 applies only to Certified Public Accountants and Enrolled Agents.

Accepted Answer

A) True 
 B)False  False

Question 4

A married couple has taxable income of $83,125 and tax liability of:
   Determine their marginal tax rate and their average tax rate.Round your answers to 2 decimal places)

Accepted Answer

Their marginal tax r

Question 5

Which of the following trial courts hear tax cases?

Accepted Answer

A) U)S.Court of Federal Claims. 
B) U)S.Tax Court. 
C) U)S.District Court. 
D) All of these. 
A) U)S.Court of Federal Claims. 
B) U)S.Tax Court. 
C) U)S.District Court. 
D) All of these.

Question 6

The tax liability for a single individual with taxable income of $88,312 is:

Accepted Answer

A) $18,849. 
B) $18,224. 
C) $13,624. 
D) $17,853. 
A) $18,849. 
B) $18,224. 
C) $13,624. 
D) $17,853.

Question 7

The amount of tax liability calculated using the tax tables will always be the same as the amount calculated using the tax rate schedules.

Accepted Answer

A) True 
 B)False

Question 8

Carla is age 64 and Xavier is age 66.They file their tax return as married filing jointly.During all of 2016 they did not have qualifying health coverage nor were they eligible for an exemption.Their household income was $84,990.What is the amount of shared responsibility payment they must report on their 2016 income tax return?

Accepted Answer

A) $695 
B) $2,125 
C) $1,390 
D) $1,576 
A) $695 
B) $2,125 
C) $1,390 
D) $1,576

Question 9

A tax rate that remains the same as the tax base increases is an example of what kind of tax rate structure?

Accepted Answer

A) Recessive. 
B) Progressive. 
C) Regressive. 
D) Proportional. 
A) Recessive. 
B) Progressive. 
C) Regressive. 
D) Proportional.

Question 10

The tax liability of a single individual with taxable income of $89,542 is $18,153.

Accepted Answer

A) True 
 B)False

Question 11

If a taxpayer is covered by Medicare,they are deemed to have qualifying health care insurance coverage.

Accepted Answer

A) True 
 B)False

Question 12

All paid tax preparers must follow the rules provided in Circular 230.

Accepted Answer

A) True 
 B)False

Question 13

Alice is an employee of Valley Company.She properly completed her Form 1040EZ tax return and received a refund from the IRS of $1,293.Alice had income tax withholding during the year of $4,881.Her tax liability for the year was:

Accepted Answer

A) $3,588. 
B) $4,881. 
C) $6,174. 
D) $1,293. 
A) $3,588. 
B) $4,881. 
C) $6,174. 
D) $1,293.

Question 14

Employers report wage income to employees on a Form W-3.

Accepted Answer

A) True 
 B)False

Question 15

Tameka has taxable income of $84,575 that is taxed as follows:

Accepted Answer

A) 25%. 
B) 10%. 
C) 15%. 
D) 20%. 
A) 25%. 
B) 10%. 
C) 15%. 
D) 20%.

Question 16

With a regressive tax,the tax rate decreases as the tax base gets larger.

Accepted Answer

A) True 
 B)False

Question 17

One major disadvantage the taxpayer has when filing a petition with the Tax Court is that the IRS's proposed tax assessment must be paid prior to trial.

Accepted Answer

A) True 
 B)False

Question 18

Sallie earned $85,000 and paid $5,950 of income tax; Theodore earned $33,000 and paid $2,310 of income tax.The tax rate structure they are subject to is:

Accepted Answer

A) Regressive. 
B) Progressive. 
C) Proportional. 
D) Recessive. 
A) Regressive. 
B) Progressive. 
C) Proportional. 
D) Recessive.

Question 19

The Affordable Care Act requires all individuals to have health care insurance coverage.

Accepted Answer

A) True 
 B)False

Question 20

Paid tax preparers must comply with all of the following EXCEPT:

Accepted Answer

A) Pass a competency examination. 
B) Sign all tax returns they prepare. 
C) Comply with the provisions of Circular 230. 
D) Charge a contingent fee. 
A) Pass a competency examination. 
B) Sign all tax returns they prepare. 
C) Comply with the provisions of Circular 230. 
D) Charge a contingent fee.

What is the definition of a proportional tax?

With respect to the income tax formula,which of the following statements is correct?

Circular 230 applies only to Certified Public Accountants and Enrolled Agents.

A married couple has taxable income of $83,125 and tax liability of: Determine their marginal tax rate and their average tax rate.Round your answers to 2 decimal places)

Which of the following trial courts hear tax cases?

The tax liability for a single individual with taxable income of $88,312 is:

The amount of tax liability calculated using the tax tables will always be the same as the amount calculated using the tax rate schedules.

A tax rate that remains the same as the tax base increases is an example of what kind of tax rate structure?

The tax liability of a single individual with taxable income of $89,542 is $18,153.

If a taxpayer is covered by Medicare,they are deemed to have qualifying health care insurance coverage.

All paid tax preparers must follow the rules provided in Circular 230.

Alice is an employee of Valley Company.She properly completed her Form 1040EZ tax return and received a refund from the IRS of $1,293.Alice had income tax withholding during the year of $4,881.Her tax liability for the year was:

Employers report wage income to employees on a Form W-3.

Tameka has taxable income of $84,575 that is taxed as follows:

With a regressive tax,the tax rate decreases as the tax base gets larger.

One major disadvantage the taxpayer has when filing a petition with the Tax Court is that the IRS's proposed tax assessment must be paid prior to trial.

Sallie earned $85,000 and paid $5,950 of income tax; Theodore earned $33,000 and paid $2,310 of income tax.The tax rate structure they are subject to is:

The Affordable Care Act requires all individuals to have health care insurance coverage.

Paid tax preparers must comply with all of the following EXCEPT:

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

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

What is the definition of a proportional tax?

With respect to the income tax formula,which of the following statements is correct?

Circular 230 applies only to Certified Public Accountants and Enrolled Agents.

A married couple has taxable income of $83,125 and tax liability of: Determine their marginal tax rate and their average tax rate.Round your answers to 2 decimal places)

Which of the following trial courts hear tax cases?

The tax liability for a single individual with taxable income of $88,312 is:

The amount of tax liability calculated using the tax tables will always be the same as the amount calculated using the tax rate schedules.

A tax rate that remains the same as the tax base increases is an example of what kind of tax rate structure?

The tax liability of a single individual with taxable income of $89,542 is $18,153.

If a taxpayer is covered by Medicare,they are deemed to have qualifying health care insurance coverage.

All paid tax preparers must follow the rules provided in Circular 230.

Alice is an employee of Valley Company.She properly completed her Form 1040EZ tax return and received a refund from the IRS of $1,293.Alice had income tax withholding during the year of $4,881.Her tax liability for the year was:

Employers report wage income to employees on a Form W-3.

Tameka has taxable income of $84,575 that is taxed as follows:

With a regressive tax,the tax rate decreases as the tax base gets larger.

One major disadvantage the taxpayer has when filing a petition with the Tax Court is that the IRS's proposed tax assessment must be paid prior to trial.

Sallie earned $85,000 and paid $5,950 of income tax; Theodore earned $33,000 and paid $2,310 of income tax.The tax rate structure they are subject to is:

The Affordable Care Act requires all individuals to have health care insurance coverage.

Paid tax preparers must comply with all of the following EXCEPT:

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

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