Question 1

Social considerations can be used to justify:

Accepted Answer

A) Allowance of a credit for child care expenses. 
B) Allowing excess capital losses to be carried over to other years. 
C) Allowing accelerated amortization for the cost of installing pollution control facilities. 
D) Allowing a Federal income tax deduction for state and local sales taxes. 
E) None of these. 
A) Allowance of a credit for child care expenses. 
B) Allowing excess capital losses to be carried over to other years. 
C) Allowing accelerated amortization for the cost of installing pollution control facilities. 
D) Allowing a Federal income tax deduction for state and local sales taxes. 
E) None of these. A

Question 2

In an office audit,the audit by the IRS takes place at the office of the taxpayer.

Accepted Answer

A) True 
 B)False  False

Question 3

Which,if any,of the following statements best describes the history of the Federal income tax?

Accepted Answer

A) It did not exist during the Civil War. 
B) The Federal income tax on corporations was held by the U.S. Supreme Court to be allowable under the U.S. Constitution. 
C) The Federal income tax on individuals was held by the U.S. Supreme Court to be allowable under the U.S. Constitution. 
D) Both the Federal income tax on individuals and on corporations was held by the U.S. Supreme Court to be contrary to the U.S. Constitution. 
E) None of these. 
A) It did not exist during the Civil War. 
B) The Federal income tax on corporations was held by the U.S. Supreme Court to be allowable under the U.S. Constitution. 
C) The Federal income tax on individuals was held by the U.S. Supreme Court to be allowable under the U.S. Constitution. 
D) Both the Federal income tax on individuals and on corporations was held by the U.S. Supreme Court to be contrary to the U.S. Constitution. 
E) None of these. B

Question 4

When a state decouples from a Federal tax provision,it means that this provision will not apply for state income tax purposes.

Accepted Answer

A) True 
 B)False

Question 5

Two months after the burglary of his personal residence,Eric is audited by the IRS.Among the items taken in the burglary was a shoe box containing approximately $50,000 in cash.Eric is the owner and operator of a cash-and-carry liquor store.Eric wonders why he was audited.Can you help explain?

Accepted Answer

Although Eric's audit by the IRS could b

Question 6

Match the statements that relate to each other. Note: Some choices may be used more than once.
a.3 years from date return is filed
b.3 years from due date of return
c.20% of underpayment
d.5% per month (25% limit)
e.0.5% per month (25% limit)
f.Conducted at IRS office
g.Conducted at taxpayer's office
h.6 years
i.45-day grace period allowed to IRS
j.No statute of limitations (period remains open)
k.75% of underpayment
l.No correct match provided
-Negligence penalty

Accepted Answer

The answer of Match the statements that relate to each...

Question 7

Which,if any,of the following transactions will decrease a taxing jurisdiction's ad valorem tax revenue imposed on real estate?

Accepted Answer

A) A tax holiday is granted to an out-of-state business that is searching for a new factory site. 
B) An abandoned church is converted to a restaurant. 
C) A public school is razed and turned into a city park. 
D) A local university sells a dormitory that will be converted for use as an apartment building. 
E) None of these. 
A) A tax holiday is granted to an out-of-state business that is searching for a new factory site. 
B) An abandoned church is converted to a restaurant. 
C) A public school is razed and turned into a city park. 
D) A local university sells a dormitory that will be converted for use as an apartment building. 
E) None of these.

Question 8

Sales made by mail order are not exempt from the application of a general sales (or use) tax.

Accepted Answer

A) True 
 B)False

Question 9

A calendar year taxpayer files his 2016 Federal income tax return on March 4,2017.The return reflects an overpayment of $6,000,and the taxpayer requests a refund of this amount.The refund is paid on May 16,2017.The refund need not include interest.

Accepted Answer

A) True 
 B)False

Question 10

A characteristic of FICA is that:

Accepted Answer

A) It does not apply when one spouse works for the other spouse. 
B) It is imposed only on the employer. 
C) It provides a modest source of income in the event of loss of employment. 
D) It is administered by both state and Federal governments. 
E) None of these. 
A) It does not apply when one spouse works for the other spouse. 
B) It is imposed only on the employer. 
C) It provides a modest source of income in the event of loss of employment. 
D) It is administered by both state and Federal governments. 
E) None of these.

Question 11

Under Clint's will,all of his property passes to either the Lutheran Church or to his wife.No Federal estate tax will be due on Clint's death in 2017.

Accepted Answer

A) True 
 B)False

Question 12

Taylor,a widow,makes cash gifts to her five married children (including their spouses) and to her seven grandchildren.What is the maximum amount Taylor can give for calendar year 2017 without using her unified transfer tax credit?

Accepted Answer

$238,000.$14,000 (an

Question 13

The U.S.(either Federal,state,or local) does not impose:

Accepted Answer

A) Franchise taxes. 
B) Severance taxes. 
C) Occupational fees. 
D) Custom duties. 
E) Export duties. 
A) Franchise taxes. 
B) Severance taxes. 
C) Occupational fees. 
D) Custom duties. 
E) Export duties.

Question 14

The tax law provides various tax credits,deductions,and exclusions that are designed to encourage taxpayers to obtain additional education.These provisions can be justified on both economic and equity grounds.

Accepted Answer

A) True 
 B)False

Question 15

The tax law allows an income tax deduction (or a credit) for foreign income taxes.Explain why.

Accepted Answer

The deduction (or a credit) fo

Question 16

Match the statements that relate to each other. Note: Some choices may be used more than once.
a.3 years from date return is filed
b.3 years from due date of return
c.20% of underpayment
d.5% per month (25% limit)
e.0.5% per month (25% limit)
f.Conducted at IRS office
g.Conducted at taxpayer's office
h.6 years
i.45-day grace period allowed to IRS
j.No statute of limitations (period remains open)
k.75% of underpayment
l.No correct match provided
-Criminal fraud penalty

Accepted Answer

The answer of Match the statements that relate to each...

Question 17

Match the statements that relate to each other. Note: Some choices may be used more than once.
a.3 years from date return is filed
b.3 years from due date of return
c.20% of underpayment
d.5% per month (25% limit)
e.0.5% per month (25% limit)
f.Conducted at IRS office
g.Conducted at taxpayer's office
h.6 years
i.45-day grace period allowed to IRS
j.No statute of limitations (period remains open)
k.75% of underpayment
l.No correct match provided
-Office audit

Accepted Answer

The answer of Match the statements that relate to each...

Question 18

Some states use their state income tax return as a means of collecting unpaid sales and use taxes.

Accepted Answer

A) True 
 B)False

Question 19

Using the choices provided below, show the justification for each provision of the tax law listed.
a.Economic considerations
b.Social considerations
c.Equity considerations
d.​Both a. and b.
-A bribe to the local sheriff,although business related,is not deductible.

Accepted Answer

The answer of Using the choices provided below, show the...

Question 20

Match the statements that relate to each other. Note: Some choices may be used more than once or not at all.
a.Deferral of gains from involuntary conversions
b.Carryback and carryforward of net operating losses
c."No change" is one possible result
d.State income tax applied to visiting nonresident
e.IRS special agent
f.Undoing the "piggyback" result
g.Ideal budget goal as to new tax legislation
h.Every state that has a general sales tax has one
i.Imposed by all states and the Federal government
j.Imposed by some states but not the Federal government
k.Imposed only by the Federal government
l.No correct match provided
-Tax fraud suspected

Accepted Answer

The answer of Match the statements that relate to each...

Exam 1: An Introduction to Taxation and Understanding the Federal Tax Law

Social considerations can be used to justify:

In an office audit,the audit by the IRS takes place at the office of the taxpayer.

Which,if any,of the following statements best describes the history of the Federal income tax?

When a state decouples from a Federal tax provision,it means that this provision will not apply for state income tax purposes.

Two months after the burglary of his personal residence,Eric is audited by the IRS.Among the items taken in the burglary was a shoe box containing approximately $50,000 in cash.Eric is the owner and operator of a cash-and-carry liquor store.Eric wonders why he was audited.Can you help explain?

Which,if any,of the following transactions will decrease a taxing jurisdiction's ad valorem tax revenue imposed on real estate?

Sales made by mail order are not exempt from the application of a general sales (or use) tax.

A calendar year taxpayer files his 2016 Federal income tax return on March 4,2017.The return reflects an overpayment of $6,000,and the taxpayer requests a refund of this amount.The refund is paid on May 16,2017.The refund need not include interest.

A characteristic of FICA is that:

Under Clint's will,all of his property passes to either the Lutheran Church or to his wife.No Federal estate tax will be due on Clint's death in 2017.

Taylor,a widow,makes cash gifts to her five married children (including their spouses) and to her seven grandchildren.What is the maximum amount Taylor can give for calendar year 2017 without using her unified transfer tax credit?

The U.S.(either Federal,state,or local) does not impose:

The tax law provides various tax credits,deductions,and exclusions that are designed to encourage taxpayers to obtain additional education.These provisions can be justified on both economic and equity grounds.

The tax law allows an income tax deduction (or a credit) for foreign income taxes.Explain why.

Some states use their state income tax return as a means of collecting unpaid sales and use taxes.

Using the choices provided below, show the justification for each provision of the tax law listed. a.Economic considerations b.Social considerations c.Equity considerations d.​Both a. and b. -A bribe to the local sheriff,although business related,is not deductible.

Working With the Tax Law

Computing the Tax

Gross Income: Concepts and Inclusions

Gross Income: Exclusions

Deductions and Losses: in General

Deductions and Losses: Certain Business Expenses and Losses

Depreciation, cost Recovery, amortization, and Depletion

Deductions: Employee and Self-Employed-Related Expenses

Deductions and Losses: Certain Itemized Deductions

Investor Losses

Tax Credits and Payments

Property Transactions: Determination of Gain or Loss, basis Considerations, and Nontaxable Exchanges

Property Transactions, capital Gains and Losses, sec1231, and Recapture Provisions

Alternative Minimum Tax

Accounting Periods and Methods

Corporations: Introduction and Operating Rules

Corporations: Organization and Capital Structure

Corporations: Distributions Not in Complete Liquidation

Corporations: Distributions in Complete Liquidation and an Overview of Reorganization

Partnerships

S Corporations

Exempt Entities

Multistate Corporate Taxation

Taxation of International Transactions

Tax Practice and Ethics

The Federal Gift and Estate Taxes

Income Taxation of Trusts and Estates

Filters

Using the choices provided below, show the justification for each provision of the tax law listed. a.Economic considerations b.Social considerations c.Equity considerations d.Both a. and b. -A bribe to the local sheriff,although business related,is not deductible.