test 1 practice test

test 1 practice test - True/False The Federal income tax...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
True/False The Federal income tax base is called “adjusted gross income.” Congress has chosen to exclude many sources of income from taxation even though it has the authority to tax income from whatever source derived. Knowing his marginal tax rate allows a taxpayer to determine the tax impact of an additional dollar added to the tax base or an additional dollar of deduction. Deductions for adjusted gross income (A.G.I.) can only be deducted if they exceed the standard deduction. T sold the family car at a $400 loss. T can claim the $400 loss as an itemized deduction. The income of a child under age 13 is taxed to the parent. H and W are married with twins, 8 years of age. Subject to phase-outs, H and W can elect to claim either exemption deductions for each of their dependents or a child tax credit for each child but not both exemptions and credits. Under a multiple support agreement, A, who provided 55 percent of the support of his mother, may assign the exemption to his sister, L, who provided 25 percent of the support. A taxpayer who does not file a tax return is protected by a seven-year statute of limitations (i.e., the IRS cannot assess a deficiency after seven years). Multiple Choice Which one of the following statements is not true concerning tax rates? a. A proportional tax rate is one in which an increasing percentage rate is applied to increasing increments of the tax base. b.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 3

test 1 practice test - True/False The Federal income tax...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online