Exam 14: Special Tax Computation Methods, tax Credits, and Payment of Tax

A credit for rehabilitation expenditures is available to a business for the purchase price of a building originally placed in service before 1936.

John has $55,000 net earnings from a sole proprietorship.John is also employed part-time by a major corporation and is paid $25,000.John's self-employment tax for 2016 is

For purposes of the limitation on qualifying expenses for the child and dependent care credit,a spouse who is either a full-time student or is incapacitated is deemed to have earned income of $250 per month,or $500 per month if there are two or more qualifying individuals in the household.

Self-employment taxes include components for

In the fall of 2016,James went back to school to earn a master of accountancy degree.He incurred $7,000 of qualified educational expenses and his modified AGI for the year was $40,000.His Lifetime Learning Credit is

Individuals without children are eligible for the earned income credit if they meet all the following conditions except

In calculating a taxpayer's AMT,adjustments for timing differences will be made for all of the following assets except for

The general business credit may not exceed the net income tax minus the greater of the tentative minimum tax or

If an individual is classified as an employee,the employer is required to withhold the employee's share of the FICA tax and to provide a matching amount.

In 2016 Charlton and Cindy have alternative minimum taxable income of $130,000 and file a joint return.For purposes of computing the alternative minimum tax,their exemption is

Tanya has earnings from self-employment of $240,000,resulting in self-employment tax of $21,122 and Additional MedicareTax of $360.Due to these taxes,Tanya will be allowed a deduction for AGI of

The nonrefundable disabled access credit is available to eligible small businesses for expenditures incurred to make existing business facilities accessible to disabled individuals.

Amelida expects to earn $145,000 of AGI and $125,000 of taxable income this year.She is concerned about underpayment penalties.Because of a substantial bonus,her prior year AGI was $155,000 and her taxable income was $135,000.She will not be subject to underpayment penalties for the current year if her estimated taxes equal or exceed any of the following criteria except

In computing AMTI,all of the following must be added back except

If estimated tax payments equal or exceed 100% of the actual tax liability for the prior year,there is generally (assuming AGI less than or equal to $150,000)no penalty for underpayment of estimated taxes.

Describe the differences between the American Opportunity Tax credit and the Lifetime Learning credit.

A taxpayer acquired an office building to be used in her business this year.For AMT purposes,depreciation must be re-calculated using the straight-line method over 40 years.

Discuss the tax planning techniques available to a U.S.citizen who is on a foreign job assignment.

Which of the following statements is incorrect regarding qualifying criteria for the health insurance premium tax credit?

Mingming and Xavier,unrelated single taxpayers,have each incurred a $1,000 expenditure.Before considering this expenditure,Mingming has taxable income of $500,000 and Xavier has taxable income of $32,000.Assume the expenditure qualifies as either a tax deduction or a 25% credit.Which of the following statements is correct?