Senior Tax Specialist (2025 Tax Law)
2025/2026 Exam Questions and Answers
| 100% Solved
Ted, age 41, files single. He earned $52,875 in wages and had no other income in
2017. On April 14 of 2018, he filed for an automatic six-month extension to file his
tax return. Three weeks later, on May 5, he timely filed his 2017 tax return. Which
statement best describes his eligibility to contribute to an IRA on May 5?
A)Because he did not make the contribution before the due date for the tax return,
he is not eligible to make an IRA contribution for 2017.
B) Because he did not file his tax return by the due date, he is only eligible to
contribute to a Roth IRA for 2017.
C) Because he did not file his tax return before the due date but did file it before
the extension due date, he is eligible to make half the maximum IRA contribution
for 2017.
D) He is eligible to make the maximum IRA contribution because he filed his 2017
tax return before the extension due date. - 🧠ANSWER ✔✔A) Because he did not
COPYRIGHT©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY 1
STATEMENT. ALL RIGHTS RESERVED
,make the contribution before the due date for the tax return, he is not eligible to
make an IRA contribution for 2017.
When Miles separated from service with his former employer, he had a $10,000
outstanding balance in an employer plan loan. He received a total distribution of
$30,000 without regard to the loan. The check he received was for $14,000.
Mandatory withholding was $6,000. How much of the distribution is taxable?
A) $10,000
B) $14,000
C) $20,000
D) $30,000 - 🧠ANSWER ✔✔D) $30,000
At age 50, Charles began receiving payments under a distribution method that
provides for substantially equal payments over his life. He had no basis in the
account. At age 58, after he had received distributions totaling $14,000, he elected
to receive the remaining benefits in a lump-sum of $155,000. What amount of the
total distribution is subject to the early distribution penalty?
A) $0
B) $14,000
C) $155,000
COPYRIGHT©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY 2
STATEMENT. ALL RIGHTS RESERVED
,D) $169,000 - 🧠ANSWER ✔✔NOT C) $155,000
Social security benefits are only taxable when gross income exceeds a certain base
amount for the taxpayer's filing status. Which of the following correctly states
these base amounts?
A) $25,000 for MFJ and $18,00 for S, HH, and QW.
B) $28,000 for MFJ and $25,000 for S, HH, and QW.
C) $32,000 for MFJ and $25,000 for S, HH, and QW.
D) $32,000 for MFJ and $28,000 for S, HH, and QW. - 🧠ANSWER ✔✔C)
$32,000 for MFJ and $25,000 for S, HH, and QW.
If a taxpayer's pension or annuity includes contributions that were previously
included in gross income, the taxpayer may generally:
A) Exclude the distributions from income, but only up to the amount of cost.
B) Use the simplified method to compute the tax-free part of the payments if they
began receiving payments after November 18, 1996.
C) Assume that the tax-free part of the payment will remain the same each year,
even if the amount of the payment changes.
COPYRIGHT©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY 3
STATEMENT. ALL RIGHTS RESERVED
, D) Make all the choices listed above. - 🧠ANSWER ✔✔D) Make all the choices
listed above
Which option correctly completes this sentence? The social security lump-sum
election means the taxpayer elects to treat the lump-sum social security benefit as
if the benefits:
A) For prior years had been received in those years by amending the prior-year
returns.
B) Had been evenly allocated among the reported years.
C) For prior years had been received in those years.
D) For prior years were received in the current year. - 🧠ANSWER ✔✔C) For prior
years had been received in those years.
Which of the following distributions is eligible for rollover treatment?
A) The required minimum distribution from a 73-year-old taxpayer's former
employer's qualified plan. The taxpayer continues to work and is an active
participant in his current employer's qualified plan.
B) A hardship distribution. By the time the distribution was received, the taxpayer
no longer faced the hardship.
COPYRIGHT©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY 4
STATEMENT. ALL RIGHTS RESERVED
2025/2026 Exam Questions and Answers
| 100% Solved
Ted, age 41, files single. He earned $52,875 in wages and had no other income in
2017. On April 14 of 2018, he filed for an automatic six-month extension to file his
tax return. Three weeks later, on May 5, he timely filed his 2017 tax return. Which
statement best describes his eligibility to contribute to an IRA on May 5?
A)Because he did not make the contribution before the due date for the tax return,
he is not eligible to make an IRA contribution for 2017.
B) Because he did not file his tax return by the due date, he is only eligible to
contribute to a Roth IRA for 2017.
C) Because he did not file his tax return before the due date but did file it before
the extension due date, he is eligible to make half the maximum IRA contribution
for 2017.
D) He is eligible to make the maximum IRA contribution because he filed his 2017
tax return before the extension due date. - 🧠ANSWER ✔✔A) Because he did not
COPYRIGHT©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY 1
STATEMENT. ALL RIGHTS RESERVED
,make the contribution before the due date for the tax return, he is not eligible to
make an IRA contribution for 2017.
When Miles separated from service with his former employer, he had a $10,000
outstanding balance in an employer plan loan. He received a total distribution of
$30,000 without regard to the loan. The check he received was for $14,000.
Mandatory withholding was $6,000. How much of the distribution is taxable?
A) $10,000
B) $14,000
C) $20,000
D) $30,000 - 🧠ANSWER ✔✔D) $30,000
At age 50, Charles began receiving payments under a distribution method that
provides for substantially equal payments over his life. He had no basis in the
account. At age 58, after he had received distributions totaling $14,000, he elected
to receive the remaining benefits in a lump-sum of $155,000. What amount of the
total distribution is subject to the early distribution penalty?
A) $0
B) $14,000
C) $155,000
COPYRIGHT©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY 2
STATEMENT. ALL RIGHTS RESERVED
,D) $169,000 - 🧠ANSWER ✔✔NOT C) $155,000
Social security benefits are only taxable when gross income exceeds a certain base
amount for the taxpayer's filing status. Which of the following correctly states
these base amounts?
A) $25,000 for MFJ and $18,00 for S, HH, and QW.
B) $28,000 for MFJ and $25,000 for S, HH, and QW.
C) $32,000 for MFJ and $25,000 for S, HH, and QW.
D) $32,000 for MFJ and $28,000 for S, HH, and QW. - 🧠ANSWER ✔✔C)
$32,000 for MFJ and $25,000 for S, HH, and QW.
If a taxpayer's pension or annuity includes contributions that were previously
included in gross income, the taxpayer may generally:
A) Exclude the distributions from income, but only up to the amount of cost.
B) Use the simplified method to compute the tax-free part of the payments if they
began receiving payments after November 18, 1996.
C) Assume that the tax-free part of the payment will remain the same each year,
even if the amount of the payment changes.
COPYRIGHT©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY 3
STATEMENT. ALL RIGHTS RESERVED
, D) Make all the choices listed above. - 🧠ANSWER ✔✔D) Make all the choices
listed above
Which option correctly completes this sentence? The social security lump-sum
election means the taxpayer elects to treat the lump-sum social security benefit as
if the benefits:
A) For prior years had been received in those years by amending the prior-year
returns.
B) Had been evenly allocated among the reported years.
C) For prior years had been received in those years.
D) For prior years were received in the current year. - 🧠ANSWER ✔✔C) For prior
years had been received in those years.
Which of the following distributions is eligible for rollover treatment?
A) The required minimum distribution from a 73-year-old taxpayer's former
employer's qualified plan. The taxpayer continues to work and is an active
participant in his current employer's qualified plan.
B) A hardship distribution. By the time the distribution was received, the taxpayer
no longer faced the hardship.
COPYRIGHT©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY 4
STATEMENT. ALL RIGHTS RESERVED
