Question 1

Assuming the kiddie tax applies,what amount of a child's income is subject to the kiddie tax?

Accepted Answer

A) All of it 
B) All of the unearned income 
C) The net unearned income 
D) Taxable income less the standard deduction 
A) All of it 
B) All of the unearned income 
C) The net unearned income 
D) Taxable income less the standard deduction

Question 2

Which of the following taxpayers (all age 40) are required to file a return?

Accepted Answer

A) Jenny and Jim 
B) Allen 
C) Timmy 
D) None of these 
A) Jenny and Jim 
B) Allen 
C) Timmy 
D) None of these

Question 3

Hera earned $175,000 salary in 2013.Her husband,Zeus,earned $100,000 salary in 2013.Hera and Zeus file a joint tax return.How much FICA taxes will they owe in 2013?

Accepted Answer

A) $21,038 
B) $18,311 
C) $14,099 
D) $3,988 
A) $21,038 
B) $18,311 
C) $14,099 
D) $3,988

Question 4

Generally,income from an active trade or business is subject to the 3.8% Medicare contribution tax.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following statements best describes the deductions independent contractors may claim for valid business expenses?

Accepted Answer

A) for AGI deductions 
B) from AGI deductions not subject to the two percent of AGI floor 
C) from AGI deductions subject to a two percent of AGI floor 
D) for AGI deductions limited to income from the business activities 
A) for AGI deductions 
B) from AGI deductions not subject to the two percent of AGI floor 
C) from AGI deductions subject to a two percent of AGI floor 
D) for AGI deductions limited to income from the business activities

Question 6

Which of the following statements about estimated tax payments and underpayment penalties is true for individual taxpayers?

Accepted Answer

A) Taxpayers who have paid their full tax liability by the original tax return due date are protected from underpayment penalties. 
B) Taxpayers who have paid their full tax liability by the extended tax return due date are protected from underpayment penalties. 
C) Taxpayers who have uneven income streams can pay estimated tax quarterly in uneven amounts and not be susceptible to underpayment penalties. 
D) Taxpayers who have paid their required amount of estimated tax,even though not on time,are protected from underpayment penalties.Even if the stream of income changes throughout the year,quarterly estimated tax can be paid using rolling percentages of the estimated tax liability for the year. 
A) Taxpayers who have paid their full tax liability by the original tax return due date are protected from underpayment penalties. 
B) Taxpayers who have paid their full tax liability by the extended tax return due date are protected from underpayment penalties. 
C) Taxpayers who have uneven income streams can pay estimated tax quarterly in uneven amounts and not be susceptible to underpayment penalties. 
D) Taxpayers who have paid their required amount of estimated tax,even though not on time,are protected from underpayment penalties.Even if the stream of income changes throughout the year,quarterly estimated tax can be paid using rolling percentages of the estimated tax liability for the year.

Question 7

Tax rate schedules are provided for use by (relatively) higher income taxpayers while the tax tables are provided for use by (relatively) lower income taxpayers.

Accepted Answer

A) True 
 B)False

Question 8

The child and dependent care credit entitles qualifying taxpayers to a credit equal to the full amount of qualified expenses.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following statements accurately describes the alternative minimum tax rate(s) ?

Accepted Answer

A) The top AMT marginal rate is higher than the top regular tax marginal tax rate. 
B) The AMT rates represent a progressive tax rate structure. 
C) The AMT rate is the same rate for all taxpayers. 
D) None of these.AMT rates are 26% and 28% (higher rate for higher incomes) .This represents a progressive tax rate structure. 
A) The top AMT marginal rate is higher than the top regular tax marginal tax rate. 
B) The AMT rates represent a progressive tax rate structure. 
C) The AMT rate is the same rate for all taxpayers. 
D) None of these.AMT rates are 26% and 28% (higher rate for higher incomes) .This represents a progressive tax rate structure.

Question 10

Parents may claim a child and dependent care credit for expenses incurred in providing for their dependents while the parents work as long as the children are over age 14 and under age 20 at year end.The dependent must be under the age of 13.

Accepted Answer

A) True 
 B)False

Question 11

Linda is a qualifying widow in 2013.In 2012,she reported $75,000 of taxable income (all ordinary) .What is her gross tax liability using the tax rate schedules?

Accepted Answer

A) $10,608 
B) $14,733 
C) $14,679 
D) $13,253 
A) $10,608 
B) $14,733 
C) $14,679 
D) $13,253

Question 12

Kaelyn's mother,Judy,looks after Kaelyn's four-year-old twins so Kaelyn can go to work (she drops off and picks up the twins from Judy's home every day) .Since Judy is a relative,Kaelyn made sure,for tax purposes,to pay her mother the going rate for child care ($6,300 for the year) .What is the amount of Kaelyn's child and dependent care credit if her AGI for the year was $36,000?

Accepted Answer

A) $1,440 
B) $2,100 
C) $6,000 
D) $0 
A) $1,440 
B) $2,100 
C) $6,000 
D) $0

Assuming the kiddie tax applies,what amount of a child's income is subject to the kiddie tax?

Which of the following taxpayers (all age 40) are required to file a return?

Hera earned $175,000 salary in 2013.Her husband,Zeus,earned $100,000 salary in 2013.Hera and Zeus file a joint tax return.How much FICA taxes will they owe in 2013?

Generally,income from an active trade or business is subject to the 3.8% Medicare contribution tax.

Which of the following statements best describes the deductions independent contractors may claim for valid business expenses?

Which of the following statements about estimated tax payments and underpayment penalties is true for individual taxpayers?

Tax rate schedules are provided for use by (relatively) higher income taxpayers while the tax tables are provided for use by (relatively) lower income taxpayers.

The child and dependent care credit entitles qualifying taxpayers to a credit equal to the full amount of qualified expenses.

Which of the following statements accurately describes the alternative minimum tax rate(s) ?

Parents may claim a child and dependent care credit for expenses incurred in providing for their dependents while the parents work as long as the children are over age 14 and under age 20 at year end.The dependent must be under the age of 13.

Linda is a qualifying widow in 2013.In 2012,she reported $75,000 of taxable income (all ordinary) .What is her gross tax liability using the tax rate schedules?

An Introduction to Tax

Tax Compliance, the Irs, and Tax Authorities

Tax Planning Strategies and Related Limitations

Individual Tax Overview

Gross Income and Exclusions

Individual Deductions

Business Income, Deductions, and Accounting Methods

Property Acquisition and Cost Recovery

Property Dispositions

Investments

Compensation

Retirement Savings and Deferred Compensation

Tax Consequences of Home Ownership

Filters

Exam 7: Individual Income Tax Computation and Tax Credits

Assuming the kiddie tax applies,what amount of a child's income is subject to the kiddie tax?

Which of the following taxpayers (all age 40) are required to file a return?

Hera earned $175,000 salary in 2013.Her husband,Zeus,earned $100,000 salary in 2013.Hera and Zeus file a joint tax return.How much FICA taxes will they owe in 2013?

Generally,income from an active trade or business is subject to the 3.8% Medicare contribution tax.

Which of the following statements best describes the deductions independent contractors may claim for valid business expenses?

Which of the following statements about estimated tax payments and underpayment penalties is true for individual taxpayers?

Tax rate schedules are provided for use by (relatively) higher income taxpayers while the tax tables are provided for use by (relatively) lower income taxpayers.

The child and dependent care credit entitles qualifying taxpayers to a credit equal to the full amount of qualified expenses.

Which of the following statements accurately describes the alternative minimum tax rate(s) ?

Parents may claim a child and dependent care credit for expenses incurred in providing for their dependents while the parents work as long as the children are over age 14 and under age 20 at year end.The dependent must be under the age of 13.

Linda is a qualifying widow in 2013.In 2012,she reported $75,000 of taxable income (all ordinary) .What is her gross tax liability using the tax rate schedules?

An Introduction to Tax

Tax Compliance, the Irs, and Tax Authorities

Tax Planning Strategies and Related Limitations

Individual Tax Overview

Gross Income and Exclusions

Individual Deductions

Business Income, Deductions, and Accounting Methods

Property Acquisition and Cost Recovery

Property Dispositions

Investments

Compensation

Retirement Savings and Deferred Compensation

Tax Consequences of Home Ownership

Filters