Day 13

Question 1

What tax credit can offset a taxpayer’s tax liability but not result in a refund?

Answer 1

Lifetime Learning Credit

MCQ-15367

Question 2

True or False: the recipient of an incentive stock option will report compensation income in the year received

Answer 2

False

MCQ-07357

Question 3

What income is subject to kiddie tax?

Answer 3

Only a portion of the child’s net Unearned Income (interest income)

MCQ-15621

Question 4

What is the basis of inherited property to the beneficiary?

Answer 4

The FMV of the property at the date of death OR the alternative Valuation method 6 months after death

MCQ-06976

Question 5

DRD Taxable Income Limitation:

Answer 5

The DRD equals the lesser of:

• 50% (or 65%) dividends received
• 50% (or 65%) of taxable income computed without regard to the DRD, any NOL carry forward, or any capital loss carry back

MCQ-02439

Question 6

Define: Accruable Expense

Answer 6

Is an expense in which services have been received/performed BUT have not been paid for by the end of the reporting period

MCQ-05279

Question 7

MCQ-08655

Question 8

Define: Gambling Loss Rule

Answer 8

A deduction FROM AGI as a miscellaneous deduction limited to gambling winnings

MCQ-04453

Question 9

How much capital loss can a corporate taxpayer deduct?

Answer 9

$0

Capital loss can be carried back 3 years and carried forward 5 years to offset capital gains

MCQ-08460