5/5/25, 10:15 PM CERTIFIED TAX PREPARER (CTP) | Quizlet
Name: Score:
20 Multiple choice questions
https://quizlet.com/166515244/test?answerTermSides=6&promptTermSides=6&questionCount=20&questionTypes=4&showImages=true 1/18
,5/5/25, 10:15 PM CERTIFIED TAX PREPARER (CTP) | Quizlet
Term 1 of 20
ESTATE TAX
* A capital tax on property imposed by municipalities; based on the estimated value of the
property.
* Deductible real estate taxes are generally any state, local, or foreign taxes on real
property. They must be charged
uniformly against all property in the jurisdiction at a like rate.
* Many states and counties also impose local benefit taxes for improvements to property,
such as assessments for streets, sidewalks, and sewer lines. These taxes cannot be
deducted, however, a taxpayer can increase the cost basis of the property by the amount of
the assessment.
* Local benefits taxes are deductible if they are for maintenance or repair, or interest
charges related to those benefits.
* Deductible personal property taxes are those based only on the value of personal
property such as a boat or car. The tax must be charged to the taxpayer on a yearly basis,
even if it is collected more than once a year or less than once a year.
* A tax on the transfer of property by one individual to another while receiving nothing, or
less than full value, in return.
* The tax applies whether the donor intends the transfer to be a gift or not.
The gift tax applies to the transfer by gift of any property. The taxpayer makes a gift if he or
she gives property (including money), or the use of or income from property, without
expecting to receive something of at least equal value in return.
* If the taxpayer sells something at less than its full value or if he or she makes an interest-
free or reduced-interest loan, he or she may be making a gift.
* For 2015, the annual exclusion for gifts is $14,000, the same as 2014.
* A tax on the right to transfer property at a taxpayer's death of everything he or she owns
or has certain interests in at the date of death.
* The executor of a decedent's estate uses Form 706 - United States Estate (and
Generation-Skipping Transfer) Tax Return to figure the estate tax imposed by Chapter 11 of
the
Internal Revenue Code.
* This tax is levied on the entire taxable estate and not just on the share received by a
particular beneficiary. Form 706 is also used to figure the generation-skipping transfer
(GST) tax imposed by Chapter 13 on direct skips (transfers to skip persons of interests in
property included in the decedent's gross estate).
* A tax consisting of Social Security and Medicare taxes primarily for individuals who work
for themselves.
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, 5/5/25, 10:15 PM CERTIFIED TAX PREPARER (CTP) | Quizlet
It is similar to the Social Security and Medicare taxes withheld from the pay of most wage
earners.
An individual figures self-employment tax (SE tax) using Schedule SE (Form 1040). Social
Security and Medicare taxes of most wage earners are figured by their employers. The
taxpayer can deduct the employer-equivalent portion of the SE tax in figuring adjusted
gross income.
* Wage earners cannot deduct Social Security and Medicare taxes.
https://quizlet.com/166515244/test?answerTermSides=6&promptTermSides=6&questionCount=20&questionTypes=4&showImages=true 3/18
Name: Score:
20 Multiple choice questions
https://quizlet.com/166515244/test?answerTermSides=6&promptTermSides=6&questionCount=20&questionTypes=4&showImages=true 1/18
,5/5/25, 10:15 PM CERTIFIED TAX PREPARER (CTP) | Quizlet
Term 1 of 20
ESTATE TAX
* A capital tax on property imposed by municipalities; based on the estimated value of the
property.
* Deductible real estate taxes are generally any state, local, or foreign taxes on real
property. They must be charged
uniformly against all property in the jurisdiction at a like rate.
* Many states and counties also impose local benefit taxes for improvements to property,
such as assessments for streets, sidewalks, and sewer lines. These taxes cannot be
deducted, however, a taxpayer can increase the cost basis of the property by the amount of
the assessment.
* Local benefits taxes are deductible if they are for maintenance or repair, or interest
charges related to those benefits.
* Deductible personal property taxes are those based only on the value of personal
property such as a boat or car. The tax must be charged to the taxpayer on a yearly basis,
even if it is collected more than once a year or less than once a year.
* A tax on the transfer of property by one individual to another while receiving nothing, or
less than full value, in return.
* The tax applies whether the donor intends the transfer to be a gift or not.
The gift tax applies to the transfer by gift of any property. The taxpayer makes a gift if he or
she gives property (including money), or the use of or income from property, without
expecting to receive something of at least equal value in return.
* If the taxpayer sells something at less than its full value or if he or she makes an interest-
free or reduced-interest loan, he or she may be making a gift.
* For 2015, the annual exclusion for gifts is $14,000, the same as 2014.
* A tax on the right to transfer property at a taxpayer's death of everything he or she owns
or has certain interests in at the date of death.
* The executor of a decedent's estate uses Form 706 - United States Estate (and
Generation-Skipping Transfer) Tax Return to figure the estate tax imposed by Chapter 11 of
the
Internal Revenue Code.
* This tax is levied on the entire taxable estate and not just on the share received by a
particular beneficiary. Form 706 is also used to figure the generation-skipping transfer
(GST) tax imposed by Chapter 13 on direct skips (transfers to skip persons of interests in
property included in the decedent's gross estate).
* A tax consisting of Social Security and Medicare taxes primarily for individuals who work
for themselves.
https://quizlet.com/166515244/test?answerTermSides=6&promptTermSides=6&questionCount=20&questionTypes=4&showImages=true 2/18
, 5/5/25, 10:15 PM CERTIFIED TAX PREPARER (CTP) | Quizlet
It is similar to the Social Security and Medicare taxes withheld from the pay of most wage
earners.
An individual figures self-employment tax (SE tax) using Schedule SE (Form 1040). Social
Security and Medicare taxes of most wage earners are figured by their employers. The
taxpayer can deduct the employer-equivalent portion of the SE tax in figuring adjusted
gross income.
* Wage earners cannot deduct Social Security and Medicare taxes.
https://quizlet.com/166515244/test?answerTermSides=6&promptTermSides=6&questionCount=20&questionTypes=4&showImages=true 3/18
