Test bank for south western federal taxation 2025 individual income taxes 48e by james c young

TEST BANKv




South-Western Federal Taxation 2025:
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Individual Income Taxes, 48th Edition by
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James Young Complete Chapters 1 - 20
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Pagev 1

,TABLEOFCONTENTS

Chapter 1:An Introduction to Taxation and Understanding the Federal Tax LawChapter 2
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: Working with the Tax Law
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Chapter 03: Tax Formula and Tax Determination Chapter
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04: Gross Income: Concepts and InclusionsChapter 05: G
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ross Income: Exclusions
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Chapter 06: Deductions and Losses: In General
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Chapter 07: Deductions and Losses: Certain Business Expenses Chapter
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08: Depreciation, Cost Recovery, Amortization, and Depletion Chapter 09:
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Deductions: Employee and Self-Employed- v v v




Related ExpenseChapter 10: Deductions and Losses: Certain Itemized De
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ductions Chapter 11: Investor Losses
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Chapter 12: Alternative Minimum Tax
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Chapter 13: Tax Credits and Payment Procedures
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Chapter 14: Property Transactions: Determination of Gain or Loss andChapt
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er 15:Property Transactions: Nontaxable Exchanges
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Chapter 16: Property Transactions: Capital Gains and Losses Chapt
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er 17:Property Transactions: 1231 and Recapture ProvisionsChapter
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18:Accounting Periods and Methods
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Chapter 19: Deferred Compensation Chapt
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er 20: Corporations and Partnerships
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Pagev 2

, Chapterv 01v 20252vIndividuals

Answers2at2the2end2of2each2chapter

Indicatevvwhetherv thev statementv is2vtruev orv false.
v v1.vSalesvmadevovervthevinternetvarevnot2exempt2fromvthevapplicationvofvavgeneralvsalesv(orvuse)vtax.
a. True
b. False

v v2.vUponvauditvbyvthevIRS,vFaithvisvassessedvavdeficiencyvofv$40,000vofvwhichv$25,000visvattributablevtovnegligence.
The220%vnegligencevpenaltyvwillvapplyvtov$25,000.
a. True
b. False

v v3.vUltimately,vmostvtaxesvarevpaidvbyvindividuals.
a. True
b. False

v v4.vEvenvifvpropertyvtaxvratesvarevnot2changed,vthevamountvofvadvvalorem2taxesvimposedvonvrealtyvmayvnotvremainthevsame.
a. True
b. False

v v5.vThevprincipalvobjectivevofvthevFUTA2tax2isvtovprovidevsomevmeasurevofvretirementvsecurity.
a. True
b. False

v

v6.vIfvmorevIRSvauditsvarevproducingvavhighervnumbervofvnovchangevresults,vthisvindicatesvincreasedvcompliancevonthe2vpa

rtvofvtaxpayers.
a. True
b. False

v

v7.vAvsafe2andveasyvwayvforvavtaxpayervtovavoidvlocalvandvstatevsalesvtaxesvisvtovmakevthevpurchasevinvavstate2 thatlevvies

novsuchvtaxes.
v

a. True
b. False

v

v8.vA2calendarvyearvtaxpayervfilesvhisv2023vFederalvincomevtaxvreturnvonvMarchv4,v2024.vThevreturnvreflects2anvoverpayvme

nt2ofv$6,000,vandvthevtaxpayervrequestsvavrefundvofvthisvamount.vThevrefundvisvpaidvonvMayv16,v2024.Thevrefundvneedvnot2vinclud
evinterest.
a. True
b. False

v v9.vAvtax2cutvenactedvbyvCongressvthatvcontainsvav sunsetvprovisionvwillvmake2thevtaxvcutvtemporary.
a. True
b. False


Pagev 3

, Name: Class: Date:vv

Chapterv 01v 2025v Individuals

v 10.vForvFederalvincomevtax2purposes,vtherevnevervhasvbeenvavgeneralvamnestyvperiod.
v

a. True
b. False

v

11.vTovlessenvorveliminatevtheveffectvofvmultiplevtaxation,vavtaxpayervwho2isvsubject2tovbothvforeignvandvU.S.vincomevtaxevsvo
v

nvthe2samevincomevisvallowedveithervavdeductionvorvavcredit2forvthevforeignvtaxvpaid.
a. True
b. False

v

12.vBecausevit2isvconsistentvwithvthevwherewithalvtovpayvconcept,vthevtaxvlawvrequiresvavsellervtovrecognizevavgainvinthevye
v

arvthevinstallmentvsalevoccurs.
a. True
b. False

v 13.vThe2amountvofvavtaxpayer’s2itemizedvdeductionsvwillvincreasevthevchance2ofvbeingvauditedvbyvthevIRS.
v

a. True
b. False

v

v14.vInv2024,vJosé,vavwidower,vsellsvlandv(fairvmarketvvaluevofv$100,000)vtovhisvdaughter,vLinda,vforv$50,000.vJosévhas2not2vm

adevavtaxablevgift.
a. True
b. False

v

v15.vForvomissionsvfromvgrossvincomevinvexcessvofv25%vofvthat2reported,vtherevisvno2statutevofvlimitationsvonvadvdit

ionalvincomevtaxvassessmentsvbyvthevIRS.
a. True
b. False

v 16.vStealthvtaxesvhave2theveffect2ofvgeneratingvadditionalvtaxesvfromvallvtaxpayers.
v

a. True
b. False

17.vJason’svbusinessvwarehousevisvdestroyedvbyvfire.vBecausevthevinsurancevproceedsvexceedvthevbasisvofvthevpropertvy,v
vvvvvvv v

avgainvresults.vIfvJasonvshortlyvreinvestsvthevproceedsvinvavnewvwarehouse,vno2gainvisvrecognizedvdue2tovthevapplicationvofvtvhevw
herewithalvto2payvconcept.
a. True
b. False

v 18.vAnvinheritance2taxvisvavtax2onvavdecedent’svrightvto2passvpropertyvatvdeath.
v

a. True
b. False

v 19.vWhenvinterest2isvchargedvonvavdeficiency,vanyvpart2ofvavmonthvcountsvas2avfullvmonth.
v

a. True
Pagev 4