Question 1

Under a divorce agreement executed in 2015, periodic payments of either cash or property must be made at regular intervals to be deductible as alimony.

Accepted Answer

A) True 
 B)False

Question 2

The determination for the deduction of the self-employment tax is based upon the:

Accepted Answer

A)  net earnings of the business. 
B)  gross earnings of the business. 
C)  total of 7.65% of FICA taxes. 
D) total of itemized deductions. 
A)  net earnings of the business. 
B)  gross earnings of the business. 
C)  total of 7.65% of FICA taxes. 
D) total of itemized deductions.

Question 3

For self-employed taxpayers, ¾ of the amount of self-employment taxes are deductible as an above-the-line deduction.

Accepted Answer

A) True 
 B)False

Question 4

In 2014, Robert, who is single, received his Bachelor's degree and started working. In 2015, he began paying interest on qualified education loans and had modified AGI of $70,000. He paid interest of $1,200 in 2015. Which of the following statements is correct?

Accepted Answer

A)  The full $1,200 is deductible in arriving at adjusted gross income. 
B)  Taxpayers are not allowed a deduction for education loan interest in 2014. 
C)  If his modified AGI had been $75,000, the phase-out rules would have reduced his deductible interest to zero. 
D) Due to the phase-out rules, only a portion of the $1,200 will be deductible. 
A)  The full $1,200 is deductible in arriving at adjusted gross income. 
B)  Taxpayers are not allowed a deduction for education loan interest in 2014. 
C)  If his modified AGI had been $75,000, the phase-out rules would have reduced his deductible interest to zero. 
D) Due to the phase-out rules, only a portion of the $1,200 will be deductible.

Question 5

Renee and Thomas obtained a divorce effective May 1, 2015. In accordance with the divorce decree, Thomas was required to pay Renee alimony of $2,500 per month (payments were to stop only in the event of her death or remarriage). Furthermore, he was to transfer title of their house which had a cost of $150,000 and a fair value of $200,000 on the date of transfer, and was to continue making the monthly mortgage payments of $1,500.
(a) Determine the amount of Thomas's alimony deduction in 2015.
(b) Determine the amount of Renee's alimony income in 2015.
(c) Assume that Thomas was required to pay off the remaining mortgage balance in the event Renee died. Does Thomas's alimony deduction in 2015 change? Why or why not?

Accepted Answer

(a) Thomas would report alimony payments

Question 6

In lieu of making cash payments of alimony directly to a former spouse, payments to a third party on behalf of the former spouse can qualify as alimony.

Accepted Answer

A) True 
 B)False

Question 7

Expenses for home schooling or for non-athletic supplies for health or physical education courses qualify for the education expense deduction.

Accepted Answer

A) True 
 B)False

Question 8

The amount of self-employed health insurance premiums that are deductible as a for AGI deduction is:

Accepted Answer

A)  100%. 
B)  80%. 
C)  70%. 
D) 50%. 
A)  100%. 
B)  80%. 
C)  70%. 
D) 50%.

Question 9

Henry graduated from the University of Maryland in 2013. In 2015, to take advantage of lower interest rates, he refinanced his qualified education loans with another qualified student loan. He is not a dependent on another person's tax return. Before AGI limits, what is the maximum deduction available to him for the $3,200 he paid for educational student loan interest in 2015?

Accepted Answer

A)  $0. 
B)  $2,000. 
C)  $2,500. 
D) $3,000. 
A)  $0. 
B)  $2,000. 
C)  $2,500. 
D) $3,000.

Question 10

A Health Savings Account (HSA) is a tax-exempt savings account to be used for qualified medical expenses.

Accepted Answer

A) True 
 B)False

Question 11

In order to meet the time test for qualifying moving expenses, a taxpayer must:

Accepted Answer

A)  Be a full-time employee for a period of 39 weeks during the 12 months following arrival in the new area. 
B)  Be a self-employed individual for at least 78 weeks during the 24 months immediately following arrival in the new area. At least 39 of the 78 weeks must be during the first 12-month period. 
C)  Remain employed only in the initial new job for the entire 39 or 78 week period. 
D) Be a full-time employee for a period of 39 weeks during the 12 months following arrival in the new area and be a self-employed individual for at least 78 weeks during the 24 months immediately following arrival in the new area. At least 39 of the 78 weeks must be during the first 12-month perioD.The time test is met if the taxpayer is a full-time employee for a period of 39 weeks during the 12 months immediately following arrival in the new area or self-employed for at least 78 weeks during the 24 months immediately following arrival in the new area. At least 39 of the 78 weeks must be during the first 12-month period. There is no requirement that all of the qualifying employment must be done in the initial position. 
A)  Be a full-time employee for a period of 39 weeks during the 12 months following arrival in the new area. 
B)  Be a self-employed individual for at least 78 weeks during the 24 months immediately following arrival in the new area. At least 39 of the 78 weeks must be during the first 12-month period. 
C)  Remain employed only in the initial new job for the entire 39 or 78 week period. 
D) Be a full-time employee for a period of 39 weeks during the 12 months following arrival in the new area and be a self-employed individual for at least 78 weeks during the 24 months immediately following arrival in the new area. At least 39 of the 78 weeks must be during the first 12-month perioD.The time test is met if the taxpayer is a full-time employee for a period of 39 weeks during the 12 months immediately following arrival in the new area or self-employed for at least 78 weeks during the 24 months immediately following arrival in the new area. At least 39 of the 78 weeks must be during the first 12-month period. There is no requirement that all of the qualifying employment must be done in the initial position.

Question 12

The deduction for self-employment taxes in2015 is deductible as an above-the-line deduction at a rate of 7.65% based on the employer's portion of the taxes.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following is not a requirement for an alimony deduction?

Accepted Answer

A)  The payments must be in cash. 
B)  The payments must cease upon the death of the payee. 
C)  The payee must have a dependent child. 
D) The payer and payee must not live in the same household at the time of the payments. 
A)  The payments must be in cash. 
B)  The payments must cease upon the death of the payee. 
C)  The payee must have a dependent child. 
D) The payer and payee must not live in the same household at the time of the payments.

Question 14

Are any moving expenses deductible other than those incurred directly for the taxpayer? If so, what are the requirements for deductibility?

Accepted Answer

Moving expenses of persons other than th

Question 15

The maximum amount of the deduction for student loan interest for an eligible taxpayer is limited in the 2015 tax year to:

Accepted Answer

A)  $1,500. 
B)  $2,000. 
C)  $2,350. 
D) $2,500. 
A)  $1,500. 
B)  $2,000. 
C)  $2,350. 
D) $2,500.

Question 16

In 2011 through 2014, Rory borrowed a total of $30,000 for higher education expenses on qualified education loans. In 2015, while still living at home and being claimed by his parents as a dependent, he began making payments on the loan. The first year interest on the loan was reported as $1,750. The amount that Rory can claim on his tax return is:

Accepted Answer

A)  $0. 
B)  $1,500. 
C)  $1,750. 
D) $2,500. 
A)  $0. 
B)  $1,500. 
C)  $1,750. 
D) $2,500.

Question 17

A qualified education loan is one incurred by the taxpayer solely to pay qualified education expenses incurred on behalf of the:

Accepted Answer

A)  taxpayer. 
B)  taxpayer's spouse. 
C)  a dependent of the taxpayer. 
D) all of these. 
A)  taxpayer. 
B)  taxpayer's spouse. 
C)  a dependent of the taxpayer. 
D) all of these.

Question 18

There is an employment test, a distance test, and a time test that must be met in order to deduct qualifying moving expenses.

Accepted Answer

A) True 
 B)False

Question 19

What is meant by a penalty on early withdrawal of savings and under what circumstances is it deductible?

Accepted Answer

Banks often require minimum or fixed dep

Question 20

An eligible educator, in the K through 12 educational system, for purposes of the educator's expense deduction is:

Accepted Answer

A)  A teacher. 
B)  A counselor. 
C)  A principal. 
D) All of these. 
A)  A teacher. 
B)  A counselor. 
C)  A principal. 
D) All of these.

Under a divorce agreement executed in 2015, periodic payments of either cash or property must be made at regular intervals to be deductible as alimony.

The determination for the deduction of the self-employment tax is based upon the:

For self-employed taxpayers, ¾ of the amount of self-employment taxes are deductible as an above-the-line deduction.

In 2014, Robert, who is single, received his Bachelor's degree and started working. In 2015, he began paying interest on qualified education loans and had modified AGI of $70,000. He paid interest of $1,200 in 2015. Which of the following statements is correct?

In lieu of making cash payments of alimony directly to a former spouse, payments to a third party on behalf of the former spouse can qualify as alimony.

Expenses for home schooling or for non-athletic supplies for health or physical education courses qualify for the education expense deduction.

The amount of self-employed health insurance premiums that are deductible as a for AGI deduction is:

A Health Savings Account (HSA) is a tax-exempt savings account to be used for qualified medical expenses.

In order to meet the time test for qualifying moving expenses, a taxpayer must:

The deduction for self-employment taxes in2015 is deductible as an above-the-line deduction at a rate of 7.65% based on the employer's portion of the taxes.

Which of the following is not a requirement for an alimony deduction?

Are any moving expenses deductible other than those incurred directly for the taxpayer? If so, what are the requirements for deductibility?

The maximum amount of the deduction for student loan interest for an eligible taxpayer is limited in the 2015 tax year to:

A qualified education loan is one incurred by the taxpayer solely to pay qualified education expenses incurred on behalf of the:

There is an employment test, a distance test, and a time test that must be met in order to deduct qualifying moving expenses.

What is meant by a penalty on early withdrawal of savings and under what circumstances is it deductible?

An eligible educator, in the K through 12 educational system, for purposes of the educator's expense deduction 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

Itemized Deductions

Self-Employed Business Income

Capital Gains and Other Sales of Property

Rental Property, Royalties, Income From Flow-Through Entities

Tax Credits

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 4: Adjustments for Adjusted Gross Income

Under a divorce agreement executed in 2015, periodic payments of either cash or property must be made at regular intervals to be deductible as alimony.

The determination for the deduction of the self-employment tax is based upon the:

For self-employed taxpayers, ¾ of the amount of self-employment taxes are deductible as an above-the-line deduction.

In 2014, Robert, who is single, received his Bachelor's degree and started working. In 2015, he began paying interest on qualified education loans and had modified AGI of $70,000. He paid interest of $1,200 in 2015. Which of the following statements is correct?

In lieu of making cash payments of alimony directly to a former spouse, payments to a third party on behalf of the former spouse can qualify as alimony.

Expenses for home schooling or for non-athletic supplies for health or physical education courses qualify for the education expense deduction.

The amount of self-employed health insurance premiums that are deductible as a for AGI deduction is:

A Health Savings Account (HSA) is a tax-exempt savings account to be used for qualified medical expenses.

In order to meet the time test for qualifying moving expenses, a taxpayer must:

The deduction for self-employment taxes in2015 is deductible as an above-the-line deduction at a rate of 7.65% based on the employer's portion of the taxes.

Which of the following is not a requirement for an alimony deduction?

Are any moving expenses deductible other than those incurred directly for the taxpayer? If so, what are the requirements for deductibility?

The maximum amount of the deduction for student loan interest for an eligible taxpayer is limited in the 2015 tax year to:

A qualified education loan is one incurred by the taxpayer solely to pay qualified education expenses incurred on behalf of the:

There is an employment test, a distance test, and a time test that must be met in order to deduct qualifying moving expenses.

What is meant by a penalty on early withdrawal of savings and under what circumstances is it deductible?

An eligible educator, in the K through 12 educational system, for purposes of the educator's expense deduction 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

Itemized Deductions

Self-Employed Business Income

Capital Gains and Other Sales of Property

Rental Property, Royalties, Income From Flow-Through Entities

Tax Credits

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