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Real Estate > Ch. 18 Taxes Affecting Real Estate > Flashcards

Ch. 18 Taxes Affecting Real Estate Flashcards

City, county, school board, and numerous special tax districts are empowered to impose taxes directly on real property in Florida as part of the powers delegated to them by the state government. The U.S. Constitution prohibits the federal government from taxing real property, passing that right on to the state and local governments. Florida is one of the states, however, that does not tax real estate at the state level.

1
Q

The owner’s original cost plus buying expenses plus capital improvements.

A

adjusted basis

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2
Q

(tax) According to the value; in proportion to worth.

A

ad valorem

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3
Q

Worth established for each unit of real property for tax purposes by a county property appraiser.

A

assessed value

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4
Q

Money or other property that is not like-kind, which is given to make up any difference in value or equity between exchanged properties.

A

boot

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5
Q

The profit from the sale of an asset, including real property.

A

capital gain

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6
Q

A loss in value for any reason; a deduction for tax purposes.

A

depreciation

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7
Q

1

A

exempt

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8
Q

Legislation that authorizes county property appraisers to assess land used for agricultural purposes according to its current value as agricultural land.

A

Green Belt Law

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9
Q

Real property that is owned by a unit of government and is not subject that taxation.

A

Immune

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10
Q

The fair market value.

A

just value

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11
Q

A unit of money used to specify a property tax rate ($1 for each $1,000 of taxable value).

A

mill

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12
Q

Property subject to taxation, but the owner is partially relieved of the burden.

A

partially exempt

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13
Q

Taxes levied against properties to pay for all, or part of, improvements that will benefit the properties being assessed.

A

special assessments

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14
Q

The assessed value less allowable exemptions resulting in an amount to which the tax rate is applied to determine property taxes due.

A

taxable value

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15
Q

An investment that shields items of income or gain from payment of income taxes; a term used to describe some taxa advantages of owning real property (or other investment), including postponement or even elimination of certain taxes.

A

tax shelter

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16
Q
  1. In Florida, real property taxes are levied on a
    a. county fiscal-year basis.
    b. calendar-year basis.
    c. fiscal-year basis.
    d. quarterly basis.
A

B

17
Q
  1. Each year in Florida, property taxes for the previous year become delinquent on
    a. January 1.
    b. April 1.
    c. November 1.
    d. December 31.
A

B

18
Q
  1. The first step in protesting the assessed value of real property is to
    a. contact the county property appraiser or a representative.
    b. contact the county tax collector or a representative.
    c. contact the Value Adjustment Board.
    d. file suit against the Value Adjustment Board.
A

A

19
Q
  1. The Value Adjustment Board is composed of
    a. the city manager, property appraiser, and three other elected officials.
    b. three school board members and two county commissioners.
    c. one school board member, two county commissioners, and two citizen members.
    d. five school board members and two county commissioners.
A

C

20
Q
  1. You have been granted homestead tax exemption. Your assessed property value is $65,000. What is your taxable property value for county taxes?
    a. $65,000
    b. $60,000
    c. $40,000
    d. $25,000
A

D

21
Q
  1. What would be your city and county property taxes if the property assessment is $38,000, you are a Florida resident receiving homestead tax exemption, and the total tax rate is 28 mills?
    a. $364
    b. $380
    c. $429
    d. $924
A

A

22
Q
  1. A 25 percent service-disabled veteran, who is 75 years of age, has been granted a homestead exemption on his $270,000 residence. How much is his total homestead exemption for county taxes?
    a. $25,500
    b. $30,000
    c. $55,000
    d. Totally tax-exempt
A

C

23
Q
  1. In arriving at a just value for agricultural property, the highest and BEST use
    a. is not a factor
    b. of the property must be for agricultural purposes only.
    c. discourages speculative investing in agricultural land.
    d. encourages speculative investing in agricultural land.
A

A

24
Q
  1. Which statement is FLASE concerning Florida’s Green Belt Law?
    a. The law is intended to protect owners of agricultural property.
    b. Farmers’ lands are shielded from excessive taxation.
    c. The law has been strengthened by qualifying agricultural land annually.
    d. The law intended to promote open green spaces along our nation’s interstates.
A

D

25
Q
  1. If a lot frontage is 100 feet, street paving costs are $40 per running foot, and the city will pay 25 percent of paving costs, what will be the assessment to the property owner?
    a. $1,000
    b. $1,500
    c. $3,000
    d. $4,000
A

B

26
Q
  1. A widow owns a home in Gainesville, Florida, in Alachua County. The city tax rate is 9.3 mills, the county rate is 9.7 mills, and the school board tax rate is 6 mills. The woman has homestead her principal residence . Her home has been assessed at $178,000. The amount of savings in property taxes realized by all allowable tax exemptions is
    a. $1,100.00.
    b. $1,112.50.
    c. $1,250.00.
    d. $1,262.50.
A

B

27
Q
  1. Current state law allows the buyer of property tax certificates to collect interest up to a maximum of
    a. 12 percent.
    b. 18 percent.
    c. the tax rate in each county.
    d. allowable interest voted by the residents of each county.
A

B

28
Q
  1. A county or city millage rate is determined by
    a. taking into account the operating budgets of the various government departments within the city or county.
    b. majority vote of the registered voters.
    c. the mayor or county commissioners after the period for filing a protest has expired.
    d. the State Legislature.
A

A

29
Q
  1. In 2010, a taxpayer had a $20,000 gain from the sale of investment property A, a $19,000 loss from the sale of investment property B, and a $5,000 loss from the sale of his principal residence. All three properties were owned for more than 12 months. The taxpayer’s only other income was his $50,000 salary. What is his 2010 total income for tax purposes, using just this information?
    a. $46,000
    b. $47,000
    c. $50,400
    d. $51,000
A

D

30
Q
  1. If a married couple who files jointly realizes a profit from the sale of their home that exceeds $500,000, what is the result?
    a. The homeowners will not pay capital gains tax if at least one of them is older than 55.
    b. Up to $125,000 of the excess profit will be taxed as a capital gain.
    c. The excess gain will be taxed at the current applicable capital gains rate.
    d. The excess gain will be taxed at the homeowner’s income tax rate.
A

C

31
Q
  1. The maximum amount of profit that may be excluded from taxation on the sale of a home for a qualifying couple, filing separately, is
    a. $125,000.
    b. $150,000.
    c. $250,000.
    d. $500,000.
A

C

32
Q
  1. Tax advantages of homeownership do NOT include
    a. a tax deduction of property taxes paid.
    b. penalty-free withdrawal from an IRA if used as a down payment on a personal residence for first-time homebuyers.
    c. exclusion of gain from the sale of a principal residence up to $500,000 for married couples filing a joint return.
    d. a tax deduction of homeowners hazard insurance.
A

D

33
Q
  1. For tax purposes, when the installment sale method is used
    a. gain is reported as payments are received.
    b. gain or loss is reported as payments are received.
    c. gain must be deferred.
    d. gain or loss must be deferred.
A

A

34
Q
  1. Which item is NOT a deductible expense for an income-producing property?
    a. Depreciation
    b. Reserve for replacement
    c. Hazard insurance
    d. Mortgage interest
A

B

35
Q
  1. A tax-sheltering real estate investment is one in which
    a. debt service is greater than net operating income.
    b. the secondary purpose is the productivity of the property.
    c. the primary purpose is reduction of personal taxable income.
    d. the amount of depreciation taken for tax purposes is greater than the actual depreciation of the property.
A

D

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