Exam 1: Introduction to Taxation

Elena owns 25% of a partnership that reported net income of $100,000 for the year.Elena's basis in her partnership interest is $20,000 at the beginning of the year.During the year $5,000 was distributed to Elena from the partnership.Assuming Elena's QBI deduction is not limited, how much in the net amount Elena is taxed on this year as a result of her interest in this partnership?

Any current changes to the tax laws are now amendments to the Internal Revenue Code of 2019.

Deazia is the sole proprietor of Baldwin Hair Salon that reported net income of $44,000 for the year.During the year she withdrew $20,000 from the business for personal use.How much income from the above must Deazia include in her gross income for the year?

Ethan received $135,000 in salary in 2019.What is his FICA tax if the Medicare rate is 1.45% and the Social Security rate is 6.2% on the 2019 maximum of $132,900?

Harold has a 50% interest in a general partnership that has a $14,000 loss for the year.He materially participates in the partnership, his basis in the partnership is $10,000 at the beginning of the year.He also has salary from other employment of $46,200.If he is single and claims the standard deduction, what are his taxable income and tax liability, respectively, in 2019?

Elena owns 25% of a partnership that reported net income of $100,000 for the year.Elena's basis in her partnership interest is $20,000 at the beginning of the year.During the year $5,000 was distributed to Elena from the partnership.What is Elena's basis at the end of the year?

The lowest tax rate on the tax rate schedules for taxable incomes is the same for individuals and C corporations.

Which of the following federal income tax rates applies to a C corporation in 2019?

In which of the following entities may an owner-employee benefit from all employee tax-free fringe benefits?

What is Jerry's basis at the end of the second year if they organize the business as a partnership?

Which of the following business entities has no provision that limits some or all of the liability of the owner?

Which of the following is a type of wealth tax?

Which of the following is a tax?

The type and degree of connection between a business and a state necessary for a state to impose a tax is referred to as nexus.

Two married persons with moderately high incomes will pay more taxes than two single persons with the same income.This is commonly called:

Which of the following are included in Adam Smith's characteristics of a good tax?

Daniel is single with taxable income of $40,000 in 2019.What is his marginal tax rate?

William lives in Delaware but works for a company that has offices in both Maryland and Pennsylvania.William spent four months working in Pennsylvania and 8 months working in Maryland.

All interest paid to a taxpayer must be included in gross income.

Elena owns 25% of a partnership that reported net income of $100,000 for the year.Elena's basis in her partnership interest is $20,000 at the beginning of the year.During the year $5,000 was distributed to Elena from the partnership.How much should Elena include in her gross income for the year?