REAL ESTATE EXPRESS TEST BANK
COMPLETE QUESTIONS AND EXPERT
REVIEWED SOLUTIONS
●● What is the maximum net capital loss that can be deducted annually?
Answer: $3,000
●● The Taxpayer Relief Act ___________ the alternate minimum tax on
small businesses.
Answer: Eliminated
●● Rob and Lori purchased a home for $350,000 with an additional
$5,000 in related purchase costs and then added a garage at a cost of
$25,000. They sold the home for $450,000 and paid $28,000 in selling
costs. How much was adjusted basis?
Answer: $380,000
●● What income taxes do residents of New York City have to pay?
Answer: Federal, State, and city income tax
●● Home equity debt is any mortgage taken out after October 13, 1987
that
, Answer: does not qualify as either home acquisitioned debt or
grandfathered debt and is secured by the homeowner's qualified home.
●● The party who receives boot in a tax- free exchange has
Answer: a net gain and must pay taxes on the difference.
●● On what properties can the owner take a mortgage interest
deduction?
Answer: A qualified primary or second home
●● Robert has three investment properties. They had the incomes of
$35,000, $50,000, and $15,000 last year. They had the expenses of
$25,000, $73,000, and $3,500 last year. What is the net income for the
three properties?
Answer: ($1,500)
●● The ______________ is responsible for preparing all of the
appropriate documentation for a 1031 exchange transaction, securing the
funds in an escrow account until the exchange is completed and
submitting a 1099 form to the taxpayer and the IRS for any gr
Answer: qualified intermediary
●● Matt sold his house for $2,200,000 and had $195,000 in closing
costs. His beginning basis was $1,955,000 and he spent $5,000 on
COMPLETE QUESTIONS AND EXPERT
REVIEWED SOLUTIONS
●● What is the maximum net capital loss that can be deducted annually?
Answer: $3,000
●● The Taxpayer Relief Act ___________ the alternate minimum tax on
small businesses.
Answer: Eliminated
●● Rob and Lori purchased a home for $350,000 with an additional
$5,000 in related purchase costs and then added a garage at a cost of
$25,000. They sold the home for $450,000 and paid $28,000 in selling
costs. How much was adjusted basis?
Answer: $380,000
●● What income taxes do residents of New York City have to pay?
Answer: Federal, State, and city income tax
●● Home equity debt is any mortgage taken out after October 13, 1987
that
, Answer: does not qualify as either home acquisitioned debt or
grandfathered debt and is secured by the homeowner's qualified home.
●● The party who receives boot in a tax- free exchange has
Answer: a net gain and must pay taxes on the difference.
●● On what properties can the owner take a mortgage interest
deduction?
Answer: A qualified primary or second home
●● Robert has three investment properties. They had the incomes of
$35,000, $50,000, and $15,000 last year. They had the expenses of
$25,000, $73,000, and $3,500 last year. What is the net income for the
three properties?
Answer: ($1,500)
●● The ______________ is responsible for preparing all of the
appropriate documentation for a 1031 exchange transaction, securing the
funds in an escrow account until the exchange is completed and
submitting a 1099 form to the taxpayer and the IRS for any gr
Answer: qualified intermediary
●● Matt sold his house for $2,200,000 and had $195,000 in closing
costs. His beginning basis was $1,955,000 and he spent $5,000 on
