Exam 12: Tax Credits and Payments

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Susan generated $55,000 of net earnings from the conduct of a tax preparation business that she operated during the tax-filing season. She also received wages of $78,200 from her full-time job. Compute the self-employment taxes due for 2018.

(Essay)

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Question 101

The tax benefit received from a tax credit is never affected by the tax rate of the taxpayer.

(True/False)

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Question 102

Certain high-income individuals are subject to three additional Medicare taxes-on wages, unearned income, and tax credits claimed.

(True/False)

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Question 103

Child and dependent care expenses include amounts paid for general household services.

(True/False)

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Question 104

Rex and Dena are married and have two children, Michelle (age 7) and Nancy (age 5). During 2018, Rex earned a salary of $24,500, received interest income of $300, and filed a joint income tax return with Dena. Dena had $0 gross income. Their earned income credit for the year is:

(Multiple Choice)

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Question 105

Roger is considering making a $6,000 investment in a venture that its promoter promises will generate immediate tax benefits for him. Roger, who does not anticipate itemizing his deductions, is in the 30% marginal income tax bracket. If the investment is of a type that produces a tax credit of 40% of the amount of the expenditure, by how much will Roger's tax liability decline because of the investment?

(Multiple Choice)

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Question 106

The earned income credit is available only if the taxpayer has at least one qualifying child in the household.

(True/False)

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Question 107

In computing the foreign tax credit, the greater of the foreign income taxes paid or the overall limitation is allowed.

(True/False)

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Question 108

An employee with outside income may be able to avoid the penalty for underpayment of estimated tax by having his employer increase income tax withholdings.

(True/False)

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Question 109

George and Jill are husband and wife, ages 67 and 65 respectively. During the year, they receive Social Security benefits of $4,000 and have adjusted gross income of $11,000. Assuming they file a joint return, their tax credit for the elderly, before considering any possible limitation due to their tax liability, is:

(Multiple Choice)

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Question 110

Which of the following correctly reflects current rules regarding estimated tax payments for individuals?

(Multiple Choice)

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Question 111

Showing 101 - 111 of 111

Susan generated $55,000 of net earnings from the conduct of a tax preparation business that she operated during the tax-filing season. She also received wages of $78,200 from her full-time job. Compute the self-employment taxes due for 2018.

The tax benefit received from a tax credit is never affected by the tax rate of the taxpayer.

Certain high-income individuals are subject to three additional Medicare taxes-on wages, unearned income, and tax credits claimed.

Child and dependent care expenses include amounts paid for general household services.

Rex and Dena are married and have two children, Michelle (age 7) and Nancy (age 5). During 2018, Rex earned a salary of $24,500, received interest income of $300, and filed a joint income tax return with Dena. Dena had $0 gross income. Their earned income credit for the year is:

The earned income credit is available only if the taxpayer has at least one qualifying child in the household.

In computing the foreign tax credit, the greater of the foreign income taxes paid or the overall limitation is allowed.

An employee with outside income may be able to avoid the penalty for underpayment of estimated tax by having his employer increase income tax withholdings.

Which of the following correctly reflects current rules regarding estimated tax payments for individuals?

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: Employee and Self-Employed-Related Expenses

Deductions and Losses: Certain Itemized Deductions

Investor Losses

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

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

Taxing Business Income

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

The Federal Gift and Estate Taxes

Income Taxation of Trusts and Estates

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