Quiz 5 Fed Income Tax

Quiz 5 Fed Income Tax - Ellen age 12 lives in the same...

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Ellen, age 12, lives in the same household with her father, grandfather, and uncle. The cost of maintaining the household is provided by her grandfather (40%) and her uncle (60%). Disregarding tie-breaker rules, Ellen is a qualifying child as to: Answer Selected Answer: D. Only her father. Correct Answer: A. All parties involved (i.e., father, grandfather, Question 2 1 out of 1 points Katrina, age 16, is claimed as a dependent by her parents. During 2010, she earned $5,500 as a checker at a grocery store. Her standard deduction is $5,800 ($5,500 earned income + $300). Answer Selected Answer: Correct Answer: Question 3 1.5 out of 1.5 points
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During 2010, Devon had the following transactions: Sala ry Inter est inco me on Gen eral Mot ors Cor pora tion bon ds Inhe ritan ce from gran dpar ents Cont ribut ion to tradi tion al IRA Lott ery win ning s 50,000 1,000 40,000 2,000 4,000 Devon’s AGI for 2010 is: Answer
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Selected Answer: $53,000. Correct Answer: $53,000. Question 4 1 out of 1 points A safe and easy way for a taxpayer to avoid local and state sales taxes is to have the purchase sent to an address in another state that levies no such taxes. Answer Selected Answer: Correct Answer: Question 5 1 out of 1 points
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The basis for the computation of regular MACRS is net of the § 179 expense that is elected. Answer Selected Answer: Correct Answer: Question 6 0 out of 1.5 points Erica (age 16) is claimed by her parents as a dependent. During 2010, she had interest income of $2,000 from a bank savings account and income from a part-time job of $4,200. Erica’s taxable income is: Answer
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Selected Answer: $6,200 - $5,700 = $500 Correct Answer: $6,200 - $4,500 = $1,700 Question 7 1 out of 1 points George, a sculptor, has an elevator installed in his house to transport heavy materials to his loft studio because he is concerned that he might strain his back by lifting heavy objects. George may deduct the full cost of the elevator as a medical expense. Answer Selected Answer: Correct Answer:
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Question 8 0 out of 1 points A net operating loss (NOL) occurs when taxable income for any year is negative because the basic standard deduction and total exemptions exceed gross income. Answer Selected Answer: Correct Answer: Question 9 1 out of 1 points
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A theft loss may only be taken in the year the theft occurred. Answer Selected Answer: Correct Answer: Question 10 1 out of 1 points A partner must include in gross income his or her share of the partnership’s income for the year whether or not the partner withdraws anything from the partnership. Answer
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Correct Answer: Question 11 1.5 out of 1.5 points Tim loaned a friend $4,000 to buy a used car. In the current year, Tim’s friend declares bankruptcy and the debt is considered totally worthless. What amount may Tim deduct on his individual income tax return for the current year as a result of the worthless debt, assuming he has no other gains or losses for the year? Answer
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This note was uploaded on 11/04/2011 for the course FED INCOME 101 taught by Professor ?? during the Spring '11 term at Post.

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Quiz 5 Fed Income Tax - Ellen age 12 lives in the same...

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