Chapter 14

Question 1

The homeowner’s exemption, excluding local assessments, saves approximately how much in property taxes?

Answer 1

$70

Question 2

The proposition that allows certain homeowners to transfer their property tax base to another home in the same county is:

Answer 2

Proposition 60

Question 3

For a homeowner which of the following is tax deductible?

Answer 3

mortgage interest

Question 4

Ad Valorem means according to:

Answer 4

value

Question 5

The second installment of real property taxes is delinquent if not paid by:

Answer 5

April 10

Question 6

A seller’s current real estate tax is $1,175 per year including the homeowner’s exemption. The condo is sold to a buyer for $197,500. Assuming no local assessments are added to the tax bill, what will be buyer’s real property tax bill including the homeowner’s exemption?

Answer 6

$1,905

Question 7

Which of the following is true?

Answer 7

a person cannot use a homeowner’s exemption and a veteran’s exemption on the same home

Question 8

A property was valued at $200,000 for property tax purposes. According to Proposition 13, what would be the maximum value for property tax purposes in two years, assuming the owner did not make capital improvements?

Answer 8

$208,080

Question 9

To obtain a full homeowner’s exemption, a new homeowner must file between January 1 and:

Answer 9

February 15

Question 10

Under certain conditions, married couples may exempt up to how much gains from the sale of a home?

Answer 10

$500,000

Question 11

When foreigners sell U.S. property the Foreign Investment in Real Property Tax Act (FIRPTA) may require what percentage be withheld from the sale proceeds?

Answer 11

10%

Question 12

Property taxes become a lien on:

Answer 12

January 1

Question 13

Private property is deeded to the state for delinquent property taxes after:

Answer 13

5 years

Question 14

When a special assessment is made on a piece of property under the Street Improvement Act of 1911:

Answer 14

it is based on the front footage of the property

Question 15

In a 1031 real estate exchange a tax liability arises if the person exchanging receives:

Answer 15

boot

Question 16

The amount paid as a commission for the sale of an owner occupied home can be deducted on the seller’s federal income tax as:

Answer 16

an expense of sale

Question 17

Under certain conditions, a single home owner may exempt up to how much in gains from the sale of a home?

Answer 17

$250,000

Question 18

Income property owners can deduct for income tax purposes:
depreciation
repairs
mortgage interest

Answer 18

all are correct

Question 19

When reference is made to a “tax free” exchange, it is usually meant that there will be:

Answer 19

deferred taxes

Question 20

The county tax assessor’s duty is to determine:

Answer 20

value of the property for tax purposes

Question 21

A law used to finance public services in newly developed areas that can lead to high assessments for the affected owners:

Answer 21

Mello-Roos

Question 22

For investors, losses on the operation of rental real estate are what type of losses?

Answer 22

passive

Question 23

Property owners can appeal the size of their property tax bill to an assessments appeals commission or in some areas to the:

Answer 23

the County’s Assessment Appeals Board or the Board of Equalization

Question 24

Federal income taxes are referred to as a:

Answer 24

progressive tax

Question 25

An investor who has owned a property for 2 years and then sells for a gain most likely will pay:

Answer 25

capital gains taxes

Question 26

To qualify for installment sale reporting, a seller must:

Answer 26

carry paper

Question 27

“A” and “B” have purchased agricultural land as joint tenants. “A” is farming the entire plot, while “B” is using no part of it. Regarding property taxes:

Answer 27

both owners are liable for taxes

Question 28

Which can be depreciated for income tax purposes?

Answer 28

rental property

Question 29

Since the passage of Proposition 13, the county tax assessor is required to value property for real property taxes on a basis of the:

Answer 29

full cash value

Question 30

Federal income taxes on the sale of income property can be deferred by which of the following methods?
carry paper 
  installment sales 
  1031 exchange
all are correct

Answer 30

all are correct