TEST BANK
South-Western Federal Taxation 2025:
Individual Income Taxes, 48th
Edition by James Young Complete
Chapters 1 - 20
Page21
,TABLE OF CONTENTS
2 2 2
Chapter 1: An Introduction to Taxation and Understanding the Federal Tax Law
2 2 2 2 2 2 2 2 2 2 2
2
Page22
,Chapter 2: Working with the Tax Law
2 2 2 2 2 2 2
Chapter 03: Tax Formula and Tax Determination
2 2 2 2 2 2 2
Chapter 04: Gross Income: Concepts and Inclusions
2 2 2 2 2 2 2
Chapter 05: Gross Income: Exclusions
2 2 2 2 2
Chapter 06: Deductions and Losses: In General
2 2 2 2 2 2 2
Chapter 07: Deductions and Losses: Certain Business Expenses
2 2 2 2 2 2 2 2
Chapter 08: Depreciation, Cost Recovery, Amortization, and Depletion
2 2 2 2 2 2 2 2
Chapter 09: Deductions: Employee and Self-Employed-Related Expense
2 2 2 2 2 2 2
Chapter 10: Deductions and Losses: Certain Itemized Deductions
2 2 2 2 2 2 2 2
Chapter 11: Investor Losses
2 2 2 2
Chapter 12: Alternative Minimum Tax
2 2 2 2 2
Chapter 13: Tax Credits and Payment Procedures
2 2 2 2 2 2 2
Chapter 14: Property Transactions: Determination of Gain or Loss and
2 2 2 2 2 2 2 2 2 2
Chapter 15: Property Transactions: Nontaxable Exchanges
2 2 2 2 2 2
Chapter 16: Property Transactions: Capital Gains and Losses
2 2 2 2 2 2 2 2
Chapter 17: Property Transactions: 1231 and Recapture Provisions
2 2 2 2 2 2 2 2
Chapter 18: Accounting Periods and Methods
2 2 2 2 2 2
Chapter 19: Deferred Compensation
2 2 2 2
Chapter 20: Corporations and Partnerships
2 2 2 2
1
1
5.2The2principal2objective2of2the2FUTA2tax2is2to2provide2some2measure2of2r
etirement2security. a. True
b. False
Page23
, Chapter1 012 20253 Individuals
Answers4at5the67end2of2each2chapter
Indicate2whether2the2statement2is2true2or2false.
2 2
1.2Sales2made2over2the2internet2are2not2exempt2from2the2application2of2a2general
2sales2(or2use)2tax. a. True
b. False
2 2
2.2Upon2audit2by2the2IRS,2Faith2is2assessed2a2deficiency2of2$40,0002of2which2$25,0002is2
attributable2to2negligence. The220%2negligence2penalty2will2apply2to2$25,000. a. True
b. False
2 2 3.2Ultimately,2most2taxes2are2paid2by2individuals.
a. True
b. False
1
2
6.2If2more2IRS2audits2are2producing2a2higher2number2of2no2change2results,2this2indicates2increased2c
ompliance2onthe2 2 part2of2taxpayers. a. True
b. False
3
4
7.2A2safe2and2easy2way2for2a2taxpayer2to2avoid2local2and2state2sales2taxes2is2to2make2the2purchase2i
n2a2state2thatlev2 ies2no2such2taxes. a. True
b. False
5
6
8.2A2calendar2year2taxpayer2files2his220232Federal2income2tax2return2on2March24,22024.2The2return2ref
lects2an2overpay
ment2of2$6,000,2and2the2taxpayer2requests2a2refund2of2this2amount.2The2refund2is2paid2on2May216,220
24.The2 2refund2need2not2 include2interest. a. True
b. False
7
9.2A2tax2cut2enacted2by2Congress2that2contains2a2sunset2provision2will2make2the2t
ax2cut2temporary. a. True
b. False
Page24
South-Western Federal Taxation 2025:
Individual Income Taxes, 48th
Edition by James Young Complete
Chapters 1 - 20
Page21
,TABLE OF CONTENTS
2 2 2
Chapter 1: An Introduction to Taxation and Understanding the Federal Tax Law
2 2 2 2 2 2 2 2 2 2 2
2
Page22
,Chapter 2: Working with the Tax Law
2 2 2 2 2 2 2
Chapter 03: Tax Formula and Tax Determination
2 2 2 2 2 2 2
Chapter 04: Gross Income: Concepts and Inclusions
2 2 2 2 2 2 2
Chapter 05: Gross Income: Exclusions
2 2 2 2 2
Chapter 06: Deductions and Losses: In General
2 2 2 2 2 2 2
Chapter 07: Deductions and Losses: Certain Business Expenses
2 2 2 2 2 2 2 2
Chapter 08: Depreciation, Cost Recovery, Amortization, and Depletion
2 2 2 2 2 2 2 2
Chapter 09: Deductions: Employee and Self-Employed-Related Expense
2 2 2 2 2 2 2
Chapter 10: Deductions and Losses: Certain Itemized Deductions
2 2 2 2 2 2 2 2
Chapter 11: Investor Losses
2 2 2 2
Chapter 12: Alternative Minimum Tax
2 2 2 2 2
Chapter 13: Tax Credits and Payment Procedures
2 2 2 2 2 2 2
Chapter 14: Property Transactions: Determination of Gain or Loss and
2 2 2 2 2 2 2 2 2 2
Chapter 15: Property Transactions: Nontaxable Exchanges
2 2 2 2 2 2
Chapter 16: Property Transactions: Capital Gains and Losses
2 2 2 2 2 2 2 2
Chapter 17: Property Transactions: 1231 and Recapture Provisions
2 2 2 2 2 2 2 2
Chapter 18: Accounting Periods and Methods
2 2 2 2 2 2
Chapter 19: Deferred Compensation
2 2 2 2
Chapter 20: Corporations and Partnerships
2 2 2 2
1
1
5.2The2principal2objective2of2the2FUTA2tax2is2to2provide2some2measure2of2r
etirement2security. a. True
b. False
Page23
, Chapter1 012 20253 Individuals
Answers4at5the67end2of2each2chapter
Indicate2whether2the2statement2is2true2or2false.
2 2
1.2Sales2made2over2the2internet2are2not2exempt2from2the2application2of2a2general
2sales2(or2use)2tax. a. True
b. False
2 2
2.2Upon2audit2by2the2IRS,2Faith2is2assessed2a2deficiency2of2$40,0002of2which2$25,0002is2
attributable2to2negligence. The220%2negligence2penalty2will2apply2to2$25,000. a. True
b. False
2 2 3.2Ultimately,2most2taxes2are2paid2by2individuals.
a. True
b. False
1
2
6.2If2more2IRS2audits2are2producing2a2higher2number2of2no2change2results,2this2indicates2increased2c
ompliance2onthe2 2 part2of2taxpayers. a. True
b. False
3
4
7.2A2safe2and2easy2way2for2a2taxpayer2to2avoid2local2and2state2sales2taxes2is2to2make2the2purchase2i
n2a2state2thatlev2 ies2no2such2taxes. a. True
b. False
5
6
8.2A2calendar2year2taxpayer2files2his220232Federal2income2tax2return2on2March24,22024.2The2return2ref
lects2an2overpay
ment2of2$6,000,2and2the2taxpayer2requests2a2refund2of2this2amount.2The2refund2is2paid2on2May216,220
24.The2 2refund2need2not2 include2interest. a. True
b. False
7
9.2A2tax2cut2enacted2by2Congress2that2contains2a2sunset2provision2will2make2the2t
ax2cut2temporary. a. True
b. False
Page24
