dividual
estern federal
income
Test bank
taxation
taxesfor48e
2025
south
by individual
james
westernc young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@@@@@@@@@@
federal
incometaxation
taxes 48e 2025 by individual
james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@
income taxes 48e by james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@
TEST BANK
South-Western Federal Taxation 2025:
Individual Income Taxes, 48th Edition
by James Young Complete Chapters 1 - 20
Page21
dividual
estern federal
income
Test bank
taxation
taxesfor48e
2025
south
by individual
james
westernc young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@@@@@@@@@@
federal
incometaxation
taxes 48e 2025 by individual
james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@
income taxes 48e by james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@
,dividual
estern federal
income
Test bank
taxation
taxesfor48e
2025
south
by individual
james
westernc young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@@@@@@@@@@
federal
incometaxation
taxes 48e 2025 by individual
james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@
income taxes 48e by james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@
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
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
Page22
dividual
estern federal
income
Test bank
taxation
taxesfor48e
2025
south
by individual
james
westernc young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@@@@@@@@@@
federal
incometaxation
taxes 48e 2025 by individual
james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@
income taxes 48e by james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@
,dividual
estern federal
income
Test bank
taxation
taxesfor48e
2025
south
by individual
james
westernc young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@@@@@@@@@@
federal
incometaxation
taxes 48e 2025 by individual
james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@
income taxes 48e by james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@
Chapter2 012 20252 Individuals
Answers2at2the2end2of2each2chapter
Indicate2 whether2 the2 statement2 is2 true2 or2 false.
2 2 1.2Sales2made2over2the2internet2are2not2exempt2from2the2application2of2a2general2sales2(or2use)2tax.
a. True
b. False
2 2 2.2Upon2audit2by2the2IRS,2Faith2is2assessed2a2deficiency2of2$40,0002of2which2$25,0002is2attributable2to2negligence.
The220%2negligence2penalty2will2apply2to2$25,000.
a. True
b. False
2 2 3.2Ultimately,2most2taxes2are2paid2by2individuals.
a. True
b. False
2 2 4.2Even2if2property2tax2rates2are2not2changed,2the2amount2of2 ad2 valorem2taxes2imposed2on2realty2may2not2remain2the2same.
a. True
b. False
2 2 5.2The2principal2objective2of2the2FUTA2tax2is2to2provide2some2measure2of2retirement2security.
a. True
b. False
2
2 6.2If2more2IRS2audits2are2producing2a2higher2number2of2no2change2results,2this2indicates2increased2compliance2on2the2
part2of2taxpayers.
a. True
b. False
2
27.2 A2safe2and2easy2way2 for2a2taxpayer2to2avoid2local2and2state2sales2 taxes2is2to2make2the2purchase2in2a2state2 that2lev
ies2no2such2taxes.
a. True
b. False
2
2 8.2A2calendar2year2taxpayer2files2his220232Federal2income2tax2return2on2March24,22024.2The2return2reflects2an2overpay
ment2of2$6,000,2and2the2taxpayer2requests2a2refund2of2this2amount.2The2refund2is2paid2on2May216,22024.2The2refund2need2not2
include2interest.
a. True
b. False
2 2 9.2 A2tax2cut2enacted2by2Congress2that2contains2a2 sunset2 provision2will2make2the2tax2cut2temporary.
a. True
b. False
Page23
dividual
estern federal
income
Test bank
taxation
taxesfor48e
2025
south
by individual
james
westernc young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@@@@@@@@@@
federal
incometaxation
taxes 48e 2025 by individual
james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@
income taxes 48e by james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@
,dividual
estern federal
income
Test bank
taxation
taxesfor48e
2025
south
by individual
james
westernc young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@@@@@@@@@@
federal
incometaxation
taxes 48e 2025 by individual
james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@
income taxes 48e by james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@
Name: Class: Date:2
Chapter2 012 20252 Individuals
2 2 10.2For2Federal2income2tax2purposes,2there2never2has2been2a2general2amnesty2period.
a. True
b. False
2
2 11.2To2lessen2or2eliminate2the2effect2of2multiple2taxation,2a2taxpayer2who2is2subject2to2both2foreign2and2U.S.2income2taxe
s2on2the2same2income2is2allowed2either2a2deduction2or2a2credit2for2the2foreign2tax2paid.
a. True
b. False
2
2 12.2Because2it2is2consistent2with2the2wherewithal2to2pay2concept,2the2tax2law2requires2a2seller2to2recognize2a2gain2in2the2
year2the2installment2sale2occurs.
a. True
b. False
2 2 13.2The2amount2of2a2taxpayer’s2itemized2deductions2will2increase2the2chance2of2being2audited2by2the2IRS.
a. True
b. False
2
2 14.2In22024,2José,2a2widower,2sells2land2(fair2market2value2of2$100,000)2to2his2daughter,2Linda,2for2$50,000.2José2has2not2
made2a2taxable2gift.
a. True
b. False
2
2 15.2For2omissions2from2gross2income2in2excess2of225%2of2that2reported,2there2is2no2statute2of2limitations2on2ad
ditional2income2tax2assessments2by2the2IRS.
a. True
b. False
2 2 16.2Stealth2taxes2have2the2effect2of2generating2additional2taxes2from2all2taxpayers.
a. True
b. False
2
2 17.2Jason’s2business2warehouse2is2destroyed2by2fire.2Because2the2insurance2proceeds2exceed2the2basis2of2the2propert
y,2a2gain2results.2If2Jason2shortly2reinvests2the2proceeds2in2a2new2warehouse,2no2gain2is2recognized2due2to2the2application2of2t
he2wherewithal2to2pay2concept.
a. True
b. False
2 2 18.2An2inheritance2tax2is2a2tax2on2a2decedent’s2right2to2pass2property2at2death.
a. True
b. False
2 2 19.2When2interest2is2charged2on2a2deficiency,2any2part2of2a2month2counts2as2a2full2month.
a. True
b. False
Page24
dividual
estern federal
income
Test bank
taxation
taxesfor48e
2025
south
by individual
james
westernc young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@@@@@@@@@@
federal
incometaxation
taxes 48e 2025 by individual
james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@
income taxes 48e by james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@
estern federal
income
Test bank
taxation
taxesfor48e
2025
south
by individual
james
westernc young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@@@@@@@@@@
federal
incometaxation
taxes 48e 2025 by individual
james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@
income taxes 48e by james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@
TEST BANK
South-Western Federal Taxation 2025:
Individual Income Taxes, 48th Edition
by James Young Complete Chapters 1 - 20
Page21
dividual
estern federal
income
Test bank
taxation
taxesfor48e
2025
south
by individual
james
westernc young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@@@@@@@@@@
federal
incometaxation
taxes 48e 2025 by individual
james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@
income taxes 48e by james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@
,dividual
estern federal
income
Test bank
taxation
taxesfor48e
2025
south
by individual
james
westernc young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@@@@@@@@@@
federal
incometaxation
taxes 48e 2025 by individual
james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@
income taxes 48e by james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@
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
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
Page22
dividual
estern federal
income
Test bank
taxation
taxesfor48e
2025
south
by individual
james
westernc young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@@@@@@@@@@
federal
incometaxation
taxes 48e 2025 by individual
james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@
income taxes 48e by james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@
,dividual
estern federal
income
Test bank
taxation
taxesfor48e
2025
south
by individual
james
westernc young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@@@@@@@@@@
federal
incometaxation
taxes 48e 2025 by individual
james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@
income taxes 48e by james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@
Chapter2 012 20252 Individuals
Answers2at2the2end2of2each2chapter
Indicate2 whether2 the2 statement2 is2 true2 or2 false.
2 2 1.2Sales2made2over2the2internet2are2not2exempt2from2the2application2of2a2general2sales2(or2use)2tax.
a. True
b. False
2 2 2.2Upon2audit2by2the2IRS,2Faith2is2assessed2a2deficiency2of2$40,0002of2which2$25,0002is2attributable2to2negligence.
The220%2negligence2penalty2will2apply2to2$25,000.
a. True
b. False
2 2 3.2Ultimately,2most2taxes2are2paid2by2individuals.
a. True
b. False
2 2 4.2Even2if2property2tax2rates2are2not2changed,2the2amount2of2 ad2 valorem2taxes2imposed2on2realty2may2not2remain2the2same.
a. True
b. False
2 2 5.2The2principal2objective2of2the2FUTA2tax2is2to2provide2some2measure2of2retirement2security.
a. True
b. False
2
2 6.2If2more2IRS2audits2are2producing2a2higher2number2of2no2change2results,2this2indicates2increased2compliance2on2the2
part2of2taxpayers.
a. True
b. False
2
27.2 A2safe2and2easy2way2 for2a2taxpayer2to2avoid2local2and2state2sales2 taxes2is2to2make2the2purchase2in2a2state2 that2lev
ies2no2such2taxes.
a. True
b. False
2
2 8.2A2calendar2year2taxpayer2files2his220232Federal2income2tax2return2on2March24,22024.2The2return2reflects2an2overpay
ment2of2$6,000,2and2the2taxpayer2requests2a2refund2of2this2amount.2The2refund2is2paid2on2May216,22024.2The2refund2need2not2
include2interest.
a. True
b. False
2 2 9.2 A2tax2cut2enacted2by2Congress2that2contains2a2 sunset2 provision2will2make2the2tax2cut2temporary.
a. True
b. False
Page23
dividual
estern federal
income
Test bank
taxation
taxesfor48e
2025
south
by individual
james
westernc young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@@@@@@@@@@
federal
incometaxation
taxes 48e 2025 by individual
james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@
income taxes 48e by james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@
,dividual
estern federal
income
Test bank
taxation
taxesfor48e
2025
south
by individual
james
westernc young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@@@@@@@@@@
federal
incometaxation
taxes 48e 2025 by individual
james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@
income taxes 48e by james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@
Name: Class: Date:2
Chapter2 012 20252 Individuals
2 2 10.2For2Federal2income2tax2purposes,2there2never2has2been2a2general2amnesty2period.
a. True
b. False
2
2 11.2To2lessen2or2eliminate2the2effect2of2multiple2taxation,2a2taxpayer2who2is2subject2to2both2foreign2and2U.S.2income2taxe
s2on2the2same2income2is2allowed2either2a2deduction2or2a2credit2for2the2foreign2tax2paid.
a. True
b. False
2
2 12.2Because2it2is2consistent2with2the2wherewithal2to2pay2concept,2the2tax2law2requires2a2seller2to2recognize2a2gain2in2the2
year2the2installment2sale2occurs.
a. True
b. False
2 2 13.2The2amount2of2a2taxpayer’s2itemized2deductions2will2increase2the2chance2of2being2audited2by2the2IRS.
a. True
b. False
2
2 14.2In22024,2José,2a2widower,2sells2land2(fair2market2value2of2$100,000)2to2his2daughter,2Linda,2for2$50,000.2José2has2not2
made2a2taxable2gift.
a. True
b. False
2
2 15.2For2omissions2from2gross2income2in2excess2of225%2of2that2reported,2there2is2no2statute2of2limitations2on2ad
ditional2income2tax2assessments2by2the2IRS.
a. True
b. False
2 2 16.2Stealth2taxes2have2the2effect2of2generating2additional2taxes2from2all2taxpayers.
a. True
b. False
2
2 17.2Jason’s2business2warehouse2is2destroyed2by2fire.2Because2the2insurance2proceeds2exceed2the2basis2of2the2propert
y,2a2gain2results.2If2Jason2shortly2reinvests2the2proceeds2in2a2new2warehouse,2no2gain2is2recognized2due2to2the2application2of2t
he2wherewithal2to2pay2concept.
a. True
b. False
2 2 18.2An2inheritance2tax2is2a2tax2on2a2decedent’s2right2to2pass2property2at2death.
a. True
b. False
2 2 19.2When2interest2is2charged2on2a2deficiency,2any2part2of2a2month2counts2as2a2full2month.
a. True
b. False
Page24
dividual
estern federal
income
Test bank
taxation
taxesfor48e
2025
south
by individual
james
westernc young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@@@@@@@@@@
federal
incometaxation
taxes 48e 2025 by individual
james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@@@@@@@@@@@@@@@
income taxes 48e by james c young.pdf!!!!!!!!!!!!!!!!!!!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~@
