WGU C237 TAXATION I OA - OBJECTIVE
ASSESSMENT | ACCURATE AND VERIFIED | 2026
UPDATE
Describe the history of taxation in the US - Answers - 1861 - to finance civil war
1894 - Income tax reinstated but ruled unconstitutional 1895
1913 - 16th amendment
1940 - WWII mass tax
1943 - pay as you go withholding
1986 - Internal Revenue Code
Identify the sources of tax law - Answers - Legislative Branch
- Internal Revenue Code (Top)
- Congressional Committee Reports
Executive
- Income Tax Regulations
- Revenue Rulings
- Revenue Procedures
- Letter Rulings
Judicial
- Court Decisions
Describe the criteria of an equitable tax structure - Answers - Equity - equality
Certainty - Stability and certainty of amount of taxes
Convenience - no burden of records and compliance
Economy- minimal compliance and administrative costs
Simplicity - understandability
Describe the structure of individual income tax rates - Answers - Progressive - tax
increases as tax base increases
Proportional - flat tax
Regressive - decreases as tax base increases
Calculate an individuals federal income tax from his or her taxable income - Answers -
Total Income
- Exclusions
= Gross income
- Deductions
- Exemptions
= Taxable income
X tax rate
= Income tax before credits
, - Tax Credits
= Total tax liabilty
- Prepayments
=Bal due or refund
Distinguish between various types of taxes - Answers - State Tax
Local Income
Franchise Tax
Wealth transfer tax
Gift tax
Federal Estate tax
Property tax
Federal excise tax - customs
Sales Tax
Identify different types of entities that are subject to taxation in the US - Answers - -Tax
paying entities
Individuals
C Corps
-Flow through Entities
sole proprietorship
Partnerships
S Corps
LLC
LL Partnerships
Trusts
Describe the administrative procedures of the IRS - Answers - Enforcement procedures
- verify accuracy and audit
Statute of limitations - 3 years; up to 6 years if off by 25%; no limit for civil fraud
Describe various components of a tax practice - Answers - Tax Compliance and
Procedure
Tax Research
Tax Planning and Consulting
Financial planning
Define each component of the individual income tax formula - Answers - Income
Exclusion - any nontaxable income
Deductions - for AGI - expenses connected with business; from AGI - personal
expenses
Adjusted Gross Income
Itemized Deductions and Standard Deductions
Personal exemption
Taxable Income
Tax Rates and Gross Tax
ASSESSMENT | ACCURATE AND VERIFIED | 2026
UPDATE
Describe the history of taxation in the US - Answers - 1861 - to finance civil war
1894 - Income tax reinstated but ruled unconstitutional 1895
1913 - 16th amendment
1940 - WWII mass tax
1943 - pay as you go withholding
1986 - Internal Revenue Code
Identify the sources of tax law - Answers - Legislative Branch
- Internal Revenue Code (Top)
- Congressional Committee Reports
Executive
- Income Tax Regulations
- Revenue Rulings
- Revenue Procedures
- Letter Rulings
Judicial
- Court Decisions
Describe the criteria of an equitable tax structure - Answers - Equity - equality
Certainty - Stability and certainty of amount of taxes
Convenience - no burden of records and compliance
Economy- minimal compliance and administrative costs
Simplicity - understandability
Describe the structure of individual income tax rates - Answers - Progressive - tax
increases as tax base increases
Proportional - flat tax
Regressive - decreases as tax base increases
Calculate an individuals federal income tax from his or her taxable income - Answers -
Total Income
- Exclusions
= Gross income
- Deductions
- Exemptions
= Taxable income
X tax rate
= Income tax before credits
, - Tax Credits
= Total tax liabilty
- Prepayments
=Bal due or refund
Distinguish between various types of taxes - Answers - State Tax
Local Income
Franchise Tax
Wealth transfer tax
Gift tax
Federal Estate tax
Property tax
Federal excise tax - customs
Sales Tax
Identify different types of entities that are subject to taxation in the US - Answers - -Tax
paying entities
Individuals
C Corps
-Flow through Entities
sole proprietorship
Partnerships
S Corps
LLC
LL Partnerships
Trusts
Describe the administrative procedures of the IRS - Answers - Enforcement procedures
- verify accuracy and audit
Statute of limitations - 3 years; up to 6 years if off by 25%; no limit for civil fraud
Describe various components of a tax practice - Answers - Tax Compliance and
Procedure
Tax Research
Tax Planning and Consulting
Financial planning
Define each component of the individual income tax formula - Answers - Income
Exclusion - any nontaxable income
Deductions - for AGI - expenses connected with business; from AGI - personal
expenses
Adjusted Gross Income
Itemized Deductions and Standard Deductions
Personal exemption
Taxable Income
Tax Rates and Gross Tax
