INTUIT ACADEMY TAX LEVEL 1 EXAM
QUESTIONS AND ANSWERS LATEST 2025-2026
UPDATE |100% PASS GUARANTEE
What type of deduction is a HSA contribution? - Answer-Above-the-
Line Deduction Some of the common expenses on which Above-the-
Line deductions are available include:
Educator expenses
Early withdrawal penalties of saving accounts
Moving expenses
Business expenses
HSA contributions
Self-employment tax
Alimony payments
Tuition fees
Contributions to a traditional IRA
Student loan interest deduction
Health insurance premiums
Retirement account contribution
As it applies to compensation income, the general rule for sourcing
wages and personal services income is controlled by
________________________________. - Answer-where the service is
performed The general rule for sourcing wages and personal services
income is controlled by where the service is performed. The residence of
,the recipient of the service, the place of contracting, and the time and
place of payment are irrelevant.
Which is considered non-taxable income? - Answer-military personnel
allowances Payments received as a member of military service are
generally taxed as wages except for retirement pay, which is taxed as a
pension. Allowances generally aren't taxed.
______________ is used to offset income and payroll taxes for low-
income workers and to provide an incentive to work. - Answer-Earned
Income Tax Credit Earned Income Tax Credit is used to offset income
and payroll taxes for low-income workers and to provide an incentive to
work.
Which is a non-deductible business expense? - Answer-family vacation
Expenses done for personal and recreational purposes are personal
expenses and are non-deductible.
What amount of upper cap is applicable on business gifts? - Answer-
$25 The upper cap of $25 is applicable on business gifts.
If yearly dividend amounts exceed __________, a Schedule B must be
completed and attached to Form 1040. - Answer-$1500 If yearly
dividend amounts exceed $1500, a Schedule B must be completed and
attached.
, The are _________ filing statuses. - Answer-five There are five filing
statuses.
Single
Married Filing Jointly
Married Filing Separately
Head of Household
Qualifying Widow(er)
Taxpayers can claim a Child Tax Credit of up to __________ for each
child under age 17 in 2021(2022). - Answer-$3,600.00 Taxpayers can
claim a CTC of up to $3,600 for each child under age 17 in 2021(2022).
Since 2021, qualifying families may now receive up to $3,600 per child
under the age of 5 and $3,000 for those ages 6 to 17. That's up from
$2,000 per child, provided families fall under certain income thresholds
(less than $150,000 for couples and $112,500 for single parents).
______________ includes supplemental income and loss. - Answer-
Schedule E includes supplemental income and loss
Supplemental Income and Loss consists of:
Income or Loss from Rental Real Estate and Royalties
Income or Loss from Partnerships and S Corporations
Income or Loss from Estates and Trusts, and
Income or Loss from Real Estate Mortgage Investment Conduits
(REMICs)
, Payments and refundable credits are listed between what lines on Form
1040? - Answer-Lines 25 through 30 are payments and refundable
credits.
A partnership files a tax return on ______________. - Answer-A
partnership files a tax return on Form 1065.
Which of the following is not a requirement for S-Corporation election?
- Answer-Being an international entity is not a requirement for S-
Corporation election.
________________ generally have to make estimated tax payments if
they expect to owe tax of $500 or more when their return is filed. -
Answer-Corporations generally have to make estimated tax payments if
they expect to owe tax of $500 or more when their return is filed.
Which is not a nonrefundable tax credit? (Select all that apply) -
Answer-Child and Dependent Care Credit Nonrefundable tax credits
include:
Child Tax Credit/Credit for Other Dependents
Adoption Credit
Social Security benefits can be taxed to a maximum of ___________%
based on the beneficiary's annual income. - Answer-Up to 85% of your
Social Security income is taxed if you receive income from other
sources and your combined income is more than a certain base amount.
QUESTIONS AND ANSWERS LATEST 2025-2026
UPDATE |100% PASS GUARANTEE
What type of deduction is a HSA contribution? - Answer-Above-the-
Line Deduction Some of the common expenses on which Above-the-
Line deductions are available include:
Educator expenses
Early withdrawal penalties of saving accounts
Moving expenses
Business expenses
HSA contributions
Self-employment tax
Alimony payments
Tuition fees
Contributions to a traditional IRA
Student loan interest deduction
Health insurance premiums
Retirement account contribution
As it applies to compensation income, the general rule for sourcing
wages and personal services income is controlled by
________________________________. - Answer-where the service is
performed The general rule for sourcing wages and personal services
income is controlled by where the service is performed. The residence of
,the recipient of the service, the place of contracting, and the time and
place of payment are irrelevant.
Which is considered non-taxable income? - Answer-military personnel
allowances Payments received as a member of military service are
generally taxed as wages except for retirement pay, which is taxed as a
pension. Allowances generally aren't taxed.
______________ is used to offset income and payroll taxes for low-
income workers and to provide an incentive to work. - Answer-Earned
Income Tax Credit Earned Income Tax Credit is used to offset income
and payroll taxes for low-income workers and to provide an incentive to
work.
Which is a non-deductible business expense? - Answer-family vacation
Expenses done for personal and recreational purposes are personal
expenses and are non-deductible.
What amount of upper cap is applicable on business gifts? - Answer-
$25 The upper cap of $25 is applicable on business gifts.
If yearly dividend amounts exceed __________, a Schedule B must be
completed and attached to Form 1040. - Answer-$1500 If yearly
dividend amounts exceed $1500, a Schedule B must be completed and
attached.
, The are _________ filing statuses. - Answer-five There are five filing
statuses.
Single
Married Filing Jointly
Married Filing Separately
Head of Household
Qualifying Widow(er)
Taxpayers can claim a Child Tax Credit of up to __________ for each
child under age 17 in 2021(2022). - Answer-$3,600.00 Taxpayers can
claim a CTC of up to $3,600 for each child under age 17 in 2021(2022).
Since 2021, qualifying families may now receive up to $3,600 per child
under the age of 5 and $3,000 for those ages 6 to 17. That's up from
$2,000 per child, provided families fall under certain income thresholds
(less than $150,000 for couples and $112,500 for single parents).
______________ includes supplemental income and loss. - Answer-
Schedule E includes supplemental income and loss
Supplemental Income and Loss consists of:
Income or Loss from Rental Real Estate and Royalties
Income or Loss from Partnerships and S Corporations
Income or Loss from Estates and Trusts, and
Income or Loss from Real Estate Mortgage Investment Conduits
(REMICs)
, Payments and refundable credits are listed between what lines on Form
1040? - Answer-Lines 25 through 30 are payments and refundable
credits.
A partnership files a tax return on ______________. - Answer-A
partnership files a tax return on Form 1065.
Which of the following is not a requirement for S-Corporation election?
- Answer-Being an international entity is not a requirement for S-
Corporation election.
________________ generally have to make estimated tax payments if
they expect to owe tax of $500 or more when their return is filed. -
Answer-Corporations generally have to make estimated tax payments if
they expect to owe tax of $500 or more when their return is filed.
Which is not a nonrefundable tax credit? (Select all that apply) -
Answer-Child and Dependent Care Credit Nonrefundable tax credits
include:
Child Tax Credit/Credit for Other Dependents
Adoption Credit
Social Security benefits can be taxed to a maximum of ___________%
based on the beneficiary's annual income. - Answer-Up to 85% of your
Social Security income is taxed if you receive income from other
sources and your combined income is more than a certain base amount.
