Individual Taxation

Question 1

When is filing status determined?

Answer 1

At the end of the year?

Question 2

Does income matter for qualifying child test? If so, what is it?

Answer 2

No, but they must be under 18 OR be a full-time college student 19-23

Question 3

Does income matter for qualifying relative test? If so, what is it?

Answer 3

Yes, cannot earn over $3,000 in taxable income

Question 4

Alimony received (before/after) December 31, 2018 is TAXABLE as GROSS INCOME

Answer 4

Before = Taxable BUT CAN BE DEDUCTED
After = Not Taxable

Question 5

In order for an award to not be taxable to the individual, what are the two requirements?

Answer 5

1. Individual was given award without request

2. Donated to governmental or charitable unit

Question 6

What is the maximum amount of social security benefits that can be included in gross income?

Answer 6

85%

Question 7

State muni bonds (are/aren’t) taxable

Answer 7

are NOT

Question 8

Worker’s compensation (is/isn’t) taxable

Answer 8

is NOT

Question 9

Child support (is/isn’t) taxable

Answer 9

is NOT

Question 10

Which is satisfied first when allocated? Child support or alimony?

Answer 10

Child support is first

Question 11

Employer contributions to a qualified retirement plan are taxable upon (distribution/contribution), and earnings are taxable upon (distribution/receipt).

Answer 11

Distribution for both

Question 12

The first _______ of group-term life insurance is nontaxable as a fringe benefit.

Answer 12

$50K

Question 13

Losses from rental of personal property are disallowed if it is rented for ___ days or (more/less).

Answer 13

14 or less

Question 14

Is R&D included in uniform capitalization rules?

Answer 14

No, but anything related to DL, DM, and FOH is

Question 15

Prepaid interest must be allocated over the life of a loan for (cash/accrual) basis taxpayers

Answer 15

BOTH!

Question 16

An employer paying for their own health insurance (is/isn’t) included on Sch C

Answer 16

is NOT

Question 17

QBI deduction (is/isn’t) allowed for a SSTB over the income threshold.

Answer 17

is NOT

Question 18

Phase-in amount for QBI

Answer 18

164,900 single x 2 MFJ

Question 19

Passive losses in the excess of at-risk amounts for an activity are carried forward _______ and are deductible _________

Answer 19

Indefinitely / Against that activity

Question 20

Passive losses (including suspended ones) can be allocated against other sources of income if….

Answer 20

A partner is disposing of their interest in a partnership

Question 21

What is the Mom & Pop rule? And what is the phaseout?

Answer 21

If a married couple actively participates in real estate, then they can deduct up to 25k so long as their AGI does not exceed $100k (phaseout between 100-150k - 50 cents on the dollar)

Question 22

Portfolio income (is/isn’t) passive income

Answer 22

is NOT

Question 23

A limited partner in a partnership provides what type of passive income?

Answer 23

At-Risk

Question 24

Individual taxpayers can deduct up to ______ in net capital losses

Answer 24

$3k

Question 25

Passive recourse liabilities increase which basis?

Answer 25

Tax and At-Risk

Question 26

Passive nonrecourse liabilities increase which basis?

Answer 26

Tax basis but NOT At-Risk UNLESS it is secured by real property

Question 27

Parthership loss hurdles (3):

Answer 27

1. Tax Basis 2. At-Risk Basis 3. PAL (up to Passive Gains)

Question 28

Students can deduct ______ per year of student loan interest payments

Answer 28

$2500

Question 29

Self-employed health insurance (is/isn't) deductible

Answer 29

it IS deductible!

Question 30

Max deductible for a SEP IRA

Answer 30

20% of income after deducting 1/2 of SE taxes

Question 31

Charitable cash contributions for individuals subject to the 60% limit can be carried _______

Answer 31

Forward 5 years

Question 32

Qualified residence interest deduction is only deductable...

Answer 32

...when buying, building, or substantially improving taxpayer's home that secures the loan

Question 33

Medical insurance premiums (are/aren't) deductible

Answer 33

ARE

Question 34

Additional standard deduction amt

Answer 34

1350

Question 35

Medical expense deduction AGI floor:

Answer 35

7.5% of AGI is the FLOOR

Question 36

If property is donated and it's short-term, its max is ___% and measured at _______

Answer 36

50%, lesser of adjusted basis or FMV at time of contribution

Question 37

If property is donated and it's long-term, its max is ___% and measured at _______

Answer 37

30%, FMV at time of contribution

Question 38

The Net Investment Income tax is ___% on the (greater/lesser) of Net Investment Income or excess over AGI

Answer 38

3.8% / Lesser

Question 39

Child and dependant care credit is ___ of eligible expenses, child must be under the age of ___

Answer 39

Fully refundable up to 8k (1 dependent), 16k max / 13 years - 50% then phaseout to 20% then to 0%

Question 40

The max child tax credit can be claimed for $_____ each if AGI is beneath a certain threshold

Answer 40

$2,000

Question 41

Safe harbor for estimated payments applies to AGI in the prior year being over ____

Answer 41

$150k

Question 42

Unemployment compensation in 2021 can be deducted by ______ for low income

Answer 42

$10,200

Question 43

Retirement savings contributions credit is temporarily refundable for low-moderate income taxpayers, %'s are ____ and max is $____

Answer 43

50%, 20%, 10% - $2000

Question 44

Incentive stock options must be held at least ____ year(s) after the grant date, and at least ____ year(s) after exercise date

Answer 44

2 / 1

Question 45

Employee stock purchase plans cannot be exercised more than ____ months after the grant date.

Answer 45

27

Question 46

The option price may not be less than ____% of the lesser of the _____ of the stock when granted or excersized

Answer 46

85%

Question 47

A nonqualified stock option is considered _______ income. If the value is readily ascertainable, it is taxed when (granted/exercised). If there is a cost, it is calculated by _____________.

Answer 47

Ordinary Income Taxed when Granted Value minus Cost

Question 48

A nonqualified stock option is considered _______ income. If the value is not readily ascertainable, it is taxed when (granted/exercised).

Answer 48

Ordinary Income | Taxed when Exercised

Question 49

ISO's (are/aren't) taxable when granted and (are/aren't) taxable when exercised. They are taxed as a _______ gain or loss when sold.

Answer 49

Aren't / Aren't / Capital

Question 50

Qualified stock options (are/aren't) deductible for the employer

Answer 50

are NOT

Question 51

ESPP's (are/aren't) taxable when granted and (are/aren't) taxable when exercised. They are taxed as a _______ gain or loss when sold UNLESS they are sold at a bargain, in which case it's considered _________

Answer 51

Aren't / Aren't / Capital / Ordinary Income