Intuit Academy Tax Level 1 Exam - Complete Questions, Verified Answers & Detailed Rationales | Updated 2025/2026 | Graded A+

Intuit Academy Tax Level 1 Exam - Complete
Questions with Verified Answers - Latest Test
(Updated 2025/2026) | Graded A+

Question 1
Below the line deductions include:
Answer: Interest, QBI, Medical Expenses, Charitable Donations ✔✔



Question 2
Eligible educators can deduct up to ___ of qualified expenses paid during the tax year.
Answer: $250 ✔✔



Question 3
Which of the following is an ineligible medical expense for HSA, Archer MSA, and MA
MSA?
Answer: Cosmetic surgery (unless medically necessary) ✔✔



Question 4
The net capital gain is taxed at ___ if the married filing jointly taxpayer income is less
than $80,800.
Answer: 0% ✔✔



Question 5
To claim a child as a dependent, they must meet the qualifying child test or:
Answer: Qualifying relative test ✔✔



Question 6



pg. 1

,Ordinary dividends are taxed at the same rate as:
Answer: Ordinary income tax rate ✔✔



Question 7
Distributions from HSA, Archer MSA, or MS MSA are non-taxable when:
Answer: Spent for qualified medical expenses of your dependent ✔✔



Question 8
Which residency status is used when an individual is neither a U.S. citizen nor a resident
alien for tax purposes?
Answer: Non-resident alien ✔✔



Question 9
____ and ____ are what taxpayers must know to calculate their tax amount.
Answer: Taxable income and filing status ✔✔



Question 10
For mortgages entered into after December 15, 2017, the amount of interest the taxpayer
can deduct is no more than ____ of the debt used to buy, build, or substantially
improve their principal home and a second home.
Answer: $750,000 ✔✔



Question 11
Tax credits ____ the amount of tax due.
Answer: Reduce ✔✔



Question 12
Which form is for beneficiaries who get income from trusts and estates?
Answer: Form 1041 ✔✔



pg. 2

,Question 13
Taxable income consists of both earned and unearned income that is used to calculate
the tax. It is generally ____ than adjusted gross income.
Answer: Less ✔✔



Question 14
To satisfy the Substantial Presence Test, how many minimum days (in the current year)
must you be physically present in the United States?
Answer: 31 days ✔✔



Question 15
Complete the equation: Selling Price - Purchase Price =
Answer: Gain (or Loss) ✔✔



Question 16
____ helps sole proprietorships calculate the profit or loss from a business while also
providing the IRS with your total business income and deductions.
Answer: Schedule C ✔✔



Question 17
Above-the-Line Deduction: Some of the common expenses on which Above-the-Line
deductions are available include:
Answer: Educator expenses, Early withdrawal penalties of saving accounts, Moving
expenses, Business expenses, HSA contributions, Self-employment tax, Alimony
payments, Tuition fees, Contributions to a traditional IRA, Student loan interest
deduction, Health insurance premiums, Retirement account contribution ✔✔



Question 18
As it applies to compensation income, the general rule for sourcing wages and personal
services income is controlled by:
Answer: Where the service is performed ✔✔


pg. 3

, Question 19
Which is considered non-taxable income?
Answer: Military personnel allowances ✔✔



Question 20
____ is used to offset income and payroll taxes for low-income workers.
Answer: Earned Income Tax Credit ✔✔



Question 21
Which is a non-deductible business expense?
Answer: Family vacation expenses ✔✔



Question 22
What amount is the upper cap applicable on business gifts?
Answer: $25 ✔✔



Question 23
If yearly dividend amounts exceed ____, a Schedule B must be completed and attached
to Form 1040.
Answer: $1,500 ✔✔



Question 24
The five filing statuses are:
Answer: Single, Married Filing Jointly, Married Filing Separately, Head of Household,
Qualifying Widow(er) ✔✔



Question 25




pg. 4