Question 1

Katlyn reported $300 of net income from her sole proprietorship. She is not required to pay self-employment tax.

Accepted Answer

A) True 
 B)False

Question 2

Clarissa's gross tax liability for 2016 is $1,300. She has a $1,500 nonrefundable personal tax credit, a $750 business tax credit, and a $400 refundable personal tax credit. Her employer withheld $1,000 from her pay for taxes. What is her net tax due or refund for this year?

Accepted Answer

Refund of $1,400.
Ex

Question 3

Linda is a qualifying widow in 2016. In 2016, she reports $80,000 of taxable income (all ordinary). What is her gross tax liability using the tax rate schedules?

Accepted Answer

A)  $11,543 
B)  $14,298 
C)  $15,771 
D)  $15,893 
A)  $11,543 
B)  $14,298 
C)  $15,771 
D)  $15,893

Question 4

Which of the following statements regarding the child and dependent care credit is true?

Accepted Answer

A)  A married couple must file jointly to claim the credit. 
B)  A taxpayer may claim a credit for dependent care expenses for a dependent who is 14 years old or older but only if the dependent lives in the taxpayer's home for the entire year. 
C)  All else equal, a taxpayer making qualifying expenditures for three children may claim more dependent care credit than a taxpayer making (the same amount of) qualifying expenditures for two children. 
D)  None of the above statements is true. 
A)  A married couple must file jointly to claim the credit. 
B)  A taxpayer may claim a credit for dependent care expenses for a dependent who is 14 years old or older but only if the dependent lives in the taxpayer's home for the entire year. 
C)  All else equal, a taxpayer making qualifying expenditures for three children may claim more dependent care credit than a taxpayer making (the same amount of) qualifying expenditures for two children. 
D)  None of the above statements is true.

Question 5

Which of the following suggests that a working taxpayer is an independent contractor rather than an employee?

Accepted Answer

A)  Works for more than one firm 
B)  May realize a loss from business activities 
C)  Sets own working hours 
D)  Works somewhere other than on employer premises 
E)  All of the above suggest independent contractor status 
A)  Works for more than one firm 
B)  May realize a loss from business activities 
C)  Sets own working hours 
D)  Works somewhere other than on employer premises 
E)  All of the above suggest independent contractor status

Question 6

The taxable income levels in the married filing jointly tax rate schedule are _______ those in the married filing separately schedule.

Accepted Answer

A)  the same as 
B)  double 
C)  half the amount of 
D)  none of the above 
A)  the same as 
B)  double 
C)  half the amount of 
D)  none of the above

Question 7

In 2016, John (52 years old) files as a head of household with one 18-year old dependent (qualifying) child. John is eligible to claim a $700 American opportunity credit for the year. John did not have any taxes withheld by his employer during the year and he did not make any estimated tax payments. After taking credits into account, what is the amount of John's taxes payable or refund assuming that his AGI is $26,000 (all from salary) and his taxable income is $9,000?

Accepted Answer

Refund of $1,925
Exp

Question 8

The earned income credit is sometimes referred to as a negative income tax.

Accepted Answer

A) True 
 B)False

Question 9

What happens if the taxpayer owes an underpayment penalty, but does not compute it on Form 2210?

Accepted Answer

A)  Nothing, unless the taxpayer is audited 
B)  The taxpayer is immediately sent to the Tax Court 
C)  The IRS will compute and assess the penalty 
D)  The penalty is increased by five percentage points 
A)  Nothing, unless the taxpayer is audited 
B)  The taxpayer is immediately sent to the Tax Court 
C)  The IRS will compute and assess the penalty 
D)  The penalty is increased by five percentage points

Question 10

Hester (age 17) is claimed as a dependent by his parents, Charlton and Abigail. In 2016, Hester received $10,000 of qualified dividends and he received $6,000 from a part time job. What is his taxable income for 2016?

Accepted Answer

A)  $16,000 
B)  $14,950 
C)  $9,700 
D)  $9,650 
A)  $16,000 
B)  $14,950 
C)  $9,700 
D)  $9,650

Question 11

Maria and Tony are married. They are preparing to file their 2016 tax return. If they were to file as single taxpayers, Maria and Tony would report $40,000 and $60,000 of taxable income, respectively. On their joint tax return, their taxable income is $100,000. How much of a marriage penalty or benefit will Maria and Tony experience in 2016?

Accepted Answer

No marriag

Question 12

Allen Green is a single taxpayer with an AGI (and modified AGI) of $210,000, which includes $170,000 of salary, $25,000 of interest income, $10,000 of dividends, and $5,000 of long-term capital gains. What is Allen's net investment income tax liability this year, rounded to the nearest whole dollar amount?

Accepted Answer

A)  $2,465 
B)  $1,520 
C)  $570 
D)  $380 
A)  $2,465 
B)  $1,520 
C)  $570 
D)  $380

Question 13

An individual could pay 100% of her tax liability by the due date of her tax return and still be subject to underpayment tax penalties.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following statements regarding the earned income credit is true?

Accepted Answer

A)  It is a nonrefundable credit 
B)  It is possible that a taxpayer with more earned income may receive more credit than a taxpayer with less earned income 
C)  A 70-year-old taxpayer with no dependents can qualify for the credit in certain circumstances 
D)  A taxpayer whose only source of income is interest from corporate bonds is eligible for the credit 
A)  It is a nonrefundable credit 
B)  It is possible that a taxpayer with more earned income may receive more credit than a taxpayer with less earned income 
C)  A 70-year-old taxpayer with no dependents can qualify for the credit in certain circumstances 
D)  A taxpayer whose only source of income is interest from corporate bonds is eligible for the credit

Question 15

Which of the following statement(s) concerning estimated tax payments and underpayment penalties for individuals is(are) true?

Accepted Answer

A)  Whether taxpayers are subject to underpayment penalties is determined on a quarterly basis. 
B)  Due dates for estimated tax payments for a given year are April 15, June 15, September 15 of that year and January 15 of the next year unless these dates fall on a weekend or a holiday. 
C)  The amount of penalty depends on the amount of the underpayment among other factors. 
D)  All of the above statements are true. 
A)  Whether taxpayers are subject to underpayment penalties is determined on a quarterly basis. 
B)  Due dates for estimated tax payments for a given year are April 15, June 15, September 15 of that year and January 15 of the next year unless these dates fall on a weekend or a holiday. 
C)  The amount of penalty depends on the amount of the underpayment among other factors. 
D)  All of the above statements are true.

Question 16

Paul and Melissa plan on filing jointly in 2016. For the year, the couple reported taxable income of $130,000. What is their gross tax liability?

Accepted Answer

$24,043, computed as

Question 17

Looking at the following partial calendar for April, when will individual tax returns be due? $\begin{array}{|rr|r|r|r|r|r|}
\hline &&&\text {April}\
\hline \text { Sunday } & \text { Monday } & \text { Tuescday } & \text { Weanesday } & \text { Thursday } & \text { Fricay } & \text { Saturday } \
\hline & & & & & & 1 \
\hline 2 & 3 & 4 & 5 & 6 & 7 & 8 \
\hline 9 & 10 & 11 & 12 & 13 & 14 & 15 \
\hline&17 & \
&\text { National } & \
&\text { Accountants } & \
16&\text { Day } & 18&19&20&21&22 \
&\text { (Federal } & \
&\text { Holiday) } & \
\hline
\end{array}$

Accepted Answer

A)  Friday, April 14 
B)  Saturday, April 15 
C)  Sunday, April 16 
D)  Monday, April 17 
E)  Tuesday, April 18 
A)  Friday, April 14 
B)  Saturday, April 15 
C)  Sunday, April 16 
D)  Monday, April 17 
E)  Tuesday, April 18

Question 18

Max is a 14-year-old dependent of his parents. During 2016, Max earned $1,800 working part time jobs and he received $1,500 of interest income from corporate bonds that were given to him last year. What is Max's 2016 taxable income?

Accepted Answer

$1,150
Explanation: This consi

Question 19

If a married couple has one primary breadwinner, filing a joint return will likely result in a marriage penalty.

Accepted Answer

A) True 
 B)False

Question 20

Long-term capital gains are taxed at the stated AMT rate for purposes of the alternative minimum tax.

Accepted Answer

A) True 
 B)False

Katlyn reported $300 of net income from her sole proprietorship. She is not required to pay self-employment tax.

Clarissa's gross tax liability for 2016 is $1,300. She has a $1,500 nonrefundable personal tax credit, a $750 business tax credit, and a $400 refundable personal tax credit. Her employer withheld $1,000 from her pay for taxes. What is her net tax due or refund for this year?

Linda is a qualifying widow in 2016. In 2016, she reports $80,000 of taxable income (all ordinary). What is her gross tax liability using the tax rate schedules?

Which of the following statements regarding the child and dependent care credit is true?

Which of the following suggests that a working taxpayer is an independent contractor rather than an employee?

The taxable income levels in the married filing jointly tax rate schedule are _______ those in the married filing separately schedule.

The earned income credit is sometimes referred to as a negative income tax.

What happens if the taxpayer owes an underpayment penalty, but does not compute it on Form 2210?

Hester (age 17) is claimed as a dependent by his parents, Charlton and Abigail. In 2016, Hester received $10,000 of qualified dividends and he received $6,000 from a part time job. What is his taxable income for 2016?

An individual could pay 100% of her tax liability by the due date of her tax return and still be subject to underpayment tax penalties.

Which of the following statements regarding the earned income credit is true?

Which of the following statement(s) concerning estimated tax payments and underpayment penalties for individuals is(are) true?

Paul and Melissa plan on filing jointly in 2016. For the year, the couple reported taxable income of $130,000. What is their gross tax liability?

Looking at the following partial calendar for April, when will individual tax returns be due? April Sunday Monday Tuescday Weanesday Thursday Fricay Saturday 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 17 National Accountants 16 Day 18 19 20 21 22 (Federal Holiday)

Max is a 14-year-old dependent of his parents. During 2016, Max earned $1,800 working part time jobs and he received $1,500 of interest income from corporate bonds that were given to him last year. What is Max's 2016 taxable income?

If a married couple has one primary breadwinner, filing a joint return will likely result in a marriage penalty.

Long-term capital gains are taxed at the stated AMT rate for purposes of the alternative minimum tax.

An Introduction to Tax

Tax Compliance , the Irs, and Tax Authorities

Tax Planning Strategies and Related Limitations

Individual Income Tax Overview, Exemptions, and Filing Status

Gross Income and Exclusions

Individual for Agi Deductions

Individual From Agi Deductions

Business Income, Deductions, and Accounting Methods

Property Acquisition and Cost Recovery

Property Dispositions

Entities Overview

Corporate Formations and Operations

Corporate Nonliquidating and Liquidating Distributions

Forming and Operating Partnerships

Dispositions of Partnership Interests and Partnership Distributions

S: Corporations

Filters

Exam 8: Individual Income Tax Computation and Tax Credits

Katlyn reported $300 of net income from her sole proprietorship. She is not required to pay self-employment tax.

Clarissa's gross tax liability for 2016 is $1,300. She has a $1,500 nonrefundable personal tax credit, a $750 business tax credit, and a $400 refundable personal tax credit. Her employer withheld $1,000 from her pay for taxes. What is her net tax due or refund for this year?

Linda is a qualifying widow in 2016. In 2016, she reports $80,000 of taxable income (all ordinary). What is her gross tax liability using the tax rate schedules?

Which of the following statements regarding the child and dependent care credit is true?

Which of the following suggests that a working taxpayer is an independent contractor rather than an employee?

The taxable income levels in the married filing jointly tax rate schedule are _______ those in the married filing separately schedule.

The earned income credit is sometimes referred to as a negative income tax.

What happens if the taxpayer owes an underpayment penalty, but does not compute it on Form 2210?

Hester (age 17) is claimed as a dependent by his parents, Charlton and Abigail. In 2016, Hester received $10,000 of qualified dividends and he received $6,000 from a part time job. What is his taxable income for 2016?

An individual could pay 100% of her tax liability by the due date of her tax return and still be subject to underpayment tax penalties.

Which of the following statements regarding the earned income credit is true?

Which of the following statement(s) concerning estimated tax payments and underpayment penalties for individuals is(are) true?

Paul and Melissa plan on filing jointly in 2016. For the year, the couple reported taxable income of $130,000. What is their gross tax liability?

Looking at the following partial calendar for April, when will individual tax returns be due? April Sunday Monday Tuescday Weanesday Thursday Fricay Saturday 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 17 National Accountants 16 Day 18 19 20 21 22 (Federal Holiday)

Max is a 14-year-old dependent of his parents. During 2016, Max earned $1,800 working part time jobs and he received $1,500 of interest income from corporate bonds that were given to him last year. What is Max's 2016 taxable income?

If a married couple has one primary breadwinner, filing a joint return will likely result in a marriage penalty.

Long-term capital gains are taxed at the stated AMT rate for purposes of the alternative minimum tax.

An Introduction to Tax

Tax Compliance , the Irs, and Tax Authorities

Tax Planning Strategies and Related Limitations

Individual Income Tax Overview, Exemptions, and Filing Status

Gross Income and Exclusions

Individual for Agi Deductions

Individual From Agi Deductions

Business Income, Deductions, and Accounting Methods

Property Acquisition and Cost Recovery

Property Dispositions

Entities Overview

Corporate Formations and Operations

Corporate Nonliquidating and Liquidating Distributions

Forming and Operating Partnerships

Dispositions of Partnership Interests and Partnership Distributions

S: Corporations

Filters