FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 7: Individual Income Tax Computation and Tax Credits

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 21

True/False

Review LaterAdd Note

Review Later

Taxpayers are not allowed to deduct personal or dependency exemptions for alternative minimum tax purposes.

A) True
B) False

Correct Answer

verified

Show Answer

Question 22

Multiple Choice

Review LaterAdd Note

Review Later

Which of the following statement(s) concerning estimated tax payments and underpayment penalties for individuals is (are) true?

A) Whether taxpayers are subject to underpayment penalties is determined on a quarterly basis.
B) Due dates for estimated tax payments for a given year are April 15, June 15, September 15 of that year and January 15 of the next year unless these dates fall on a weekend or a holiday.
C) The amount of penalty depends on the amount of the underpayment among other factors.
D) All of these statements are true.

E) All of the above
F) B) and D)

Correct Answer

verified

Show Answer

Question 23

True/False

Review LaterAdd Note

If a married couple has one primary breadwinner, filing a joint return will likely result in a marriage penalty.

Employees must pay both Social Security tax and Medicare tax on all of their wages no matter the amount of their wages.

Depending on the year, the original (unextended) due date for an individual's tax return may be after April 15.

Katlyn reported $300 of net income from her sole proprietorship. She is not required to pay self-employment tax.

In certain circumstances a child with very little income may have their income taxed at the parents' marginal tax rate.

Taxpayers are generally allowed to carry back and/or carry forward unused business credits.

Which of the following is not a true statement about the American opportunity credit (AOC) and lifetime learning credits?

Demeter is a single taxpayer. Her AGI in 2014 is $81,200. Demeter may claim a child tax credit for her daughter Persephone. What amount of child tax credit is Demeter entitled to claim after any applicable phase-out?

Which of the following is not typical of taxpayers who are most likely affected by the AMT?

Tax rate schedules are provided for use by (relatively) higher income taxpayers while the tax tables are provided for use by (relatively) lower income taxpayers.

Which of the following tax credits is fully refundable?

The late payment penalty is based on the amount of tax owed and the number of days that the tax is not paid. The maximum amount of the penalty is unlimited.

Harmony reports a regular tax liability of $15,000 and tentative minimum tax of $17,000. Given just this information, what is her alternative minimum tax liability for the year?

Allen Green is a single taxpayer with an AGI (and modified AGI) of $210,000, which includes $170,000 of salary, $25,000 of interest income, $10,000 of dividends, and $5,000 of long-term capital gains. What is Allen's Net Investment Income tax liability this year, rounded to the nearest whole dollar amount?

Which of the following statements about estimated tax payments and underpayment penalties is true for individual taxpayers?

When applying credits against a taxpayer's gross tax liability, nonrefundable personal credits are applied first, then business credits, and finally refundable personal credits.

Miley, a single taxpayer, plans on reporting $27,900 of taxable income this year (all of her income is from a part-time job) . She is considering applying for a second part-time job that would give her an additional $10,000 of taxable income. By how much will the income from the second job increase her tax liability (use the tax rate schedules) ?

Depending on the year, the original (unextended) due date for an individual's tax return may be before April 15.