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Income Taxation exam finals > enumeration > Flashcards

enumeration Flashcards

1
Q

What are the four types of gross income for estates and trusts?

A
  1. Income accumulated for an unborn beneficiary.
  2. Income currently distributable to beneficiaries.
  3. Income received during administration of an estate.
  4. Income either distributed to beneficiaries or retained by the fiduciary.
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2
Q

Who are the four participants in a trust?

A
  1. Trustor (Grantor)
  2. Trustee
  3. Beneficiary
  4. Fiduciary
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3
Q

What are the three allowable deductions for estates and trusts?

A
  1. Income distributable to beneficiaries
  2. Income collected by a guardian
  3. Income during administration retained by fiduciary
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4
Q

What are the three conditions for taxable estates?

A
  1. Estate under judicial settlement
  2. Income received post-death included in estate income
  3. Taxation from the date of death
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5
Q

What are the three differences between taxpayer and conduit entities?

A
  1. Taxpayers are taxed on all income earned.
  2. Conduits pass income to owners for tax purposes.
  3. Trusts blend elements of both taxpayers and conduits.
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6
Q

What are the two main types of general partnerships in tax classification?

A
  1. General Professional Partnership (GPP)
  2. General Co-Partnership (Compania Colectiva)
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7
Q

What are two key responsibilities of GPPs in tax reporting?

A
  1. File an annual income tax return.
  2. Disclose partners’ names and shares.
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8
Q

What are two deductions that GPPs or partners can claim?

A
  1. Itemized Deductions
  2. Optional Standard Deduction (OSD)
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9
Q

What are two main tax statuses a co-ownership might have depending on its activities?

A
  1. Non-taxable (if limited to preservation)
  2. Taxable (if profit-generating)
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10
Q

In what two situations do GPP partners pay income tax individually?

A
  1. On distributive share in GPP income.
  2. On other personal income.
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11
Q

What are two situations when a GPP’s OSD may not be claimed by partners?

A
  1. If GPP claims OSD, partners cannot claim it.
  2. Partners’ distributive share is net.
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12
Q

What are two types of partnership losses?

A
  1. Net Operating Loss
  2. Division of Losses per Profit Sharing Ratio
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13
Q

What are two characteristics that distinguish GPP from other partnerships in taxation?

A
  1. GPP not taxed as corporation.
  2. Income taxed at partner level.
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14
Q

What are two general co-partnership tax implications for partners?

A
  1. Considered stockholders.
  2. Profits treated as dividends.
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15
Q

What are two instances where partners cannot claim further deductions on GPP income?

A
  1. When distributive share is net income.
  2. If OSD is applied at the GPP level.
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16
Q

What are three types of taxable income that include tips?

A
  1. Tips
  2. Gratuities
  3. Service charges (if voluntary)
17
Q

What are three characteristics of gratuities?

A
  1. Voluntary
  2. Taxable
  3. Not subject to withholding tax.
18
Q

Who are the three entities involved in tip transactions?

A
  1. Customers
  2. Employees
  3. Tax authorities
19
Q

What are two differences between tips and regular compensation?

A
  1. Tips are voluntary.
  2. Compensation is fixed and predetermined.
20
Q

What are three scenarios where tips are taxable?

A
  1. Paid directly to employees.
  2. Declared as income.
  3. Included in total gross income.
21
Q

What are five items included in gross income?

A
  1. Compensation income
  2. Royalties
  3. Rents
  4. Interest
  5. Pensions
22
Q

What are five examples of de minimis benefits?

A
  1. Monetized unused vacation leave credits (10 days)
  2. Medical cash allowance (up to PHP 1,500 per semester)
  3. Rice subsidy (up to PHP 2,000 per month)
  4. Uniform allowance (up to PHP 6,000 annually)
  5. Laundry allowance (up to PHP 300 per month)
23
Q

What are three items considered taxable compensation?

A
  1. Honoraria
  2. Director’s fees
  3. Stock options
24
Q

What are two examples of passive income subject to final tax?

A
  1. Interest on bank deposits
  2. Royalties
25
Q

What are two exclusions from gross income?

A
  1. Life insurance proceeds
  2. De minimis benefits

Income Taxation exam finals (3 decks)

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