I N T U I T ACADEMY TA X LEVEL 1 EXAM Q U E S T I O N S
WITH VERIFIED A N S W E R S
335 QUESTIONS AND ANSWERS
Below-the-line deductions include
Standard deduction
Eligible educators can deduct up to of qualified expenses paid during
the tax year.
$250
Which of the following is an ineligible medical expense for HSA, Archer MSA,
and MA MSA?
Breast enhancement
The net capital gain is taxed at if the married filing jointly taxpayer
income is less than $80,800.
0%
To claim a child as a dependent, they must meet the qualifying child test or
qualifying relative test
Ordinary dividends are taxed at the same rate as income tax rate.
ordinary
Distributions from HSA, Archer MSA, or MS MSA are non-taxable when
spent for qualified medical expenses of your dependent
,Which residency status is used when an individual is neither a U.S. citizen nor a
resident alien for tax purposes?
Non-resident alien
and are what taxpayers must know to calculate
their tax amount.
Taxable income and filing status
For mortgages entered into after December 15, 2017, the amount of interest the
taxpayer can deduct is no more than of the debt used to buy,
build, or substantially improve their principal home and a second home.
750,000
reduce the amount of tax due.
Ta x cred its
Which form is for beneficiaries who get income from trusts and estates?
Form 1041
consists of both earned and unearned income that is
used to calculate the tax. It is generally less than adjusted gross income due to
the deductions.
Taxable income
To satisfy the Substantial Presence Test, how many minimum days (in the
current year) must you be physically present ni the United States?
31
Complete the equation. = Selling Price - Purchase Price
Capital Loss or Capital Gain
helps sole proprietorships calculate the profit or loss from
a business while also providing the IRS with your total business income and
deductions.
Schedule C
What type of deduction is a HSA contribution?
,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 I R A
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
where the service is performed The general rule for sourcing wages and
personal services income si controlled by where hte service si performed. The
residence of the recipient of the service, the place of contracting, and hte time
and place of payment are irrelevant.
Which is considered non-taxable income?
military personnel allowances Payments received as a member of military
service are generally taxed as wages except for retirement pay, which si 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.
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?
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?
$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.
$1500 If yearly dividend amounts exceed $1500, a Schedule B must be
completed and attached.
The are filing statuses.
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).
$3,600.00 Taxpayers can claim a CTC of up to $3,600 for each child under age
71 ni 2021(2022). Since 2021, qualifying families may now receive up ot
$3,600 per child under hte age of 5and $3,000 for those ages 6ot 17. Thats' 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.
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?
Lines 25 through 30 are payments and refundable credits.
A partnership files a tax return on
WITH VERIFIED A N S W E R S
335 QUESTIONS AND ANSWERS
Below-the-line deductions include
Standard deduction
Eligible educators can deduct up to of qualified expenses paid during
the tax year.
$250
Which of the following is an ineligible medical expense for HSA, Archer MSA,
and MA MSA?
Breast enhancement
The net capital gain is taxed at if the married filing jointly taxpayer
income is less than $80,800.
0%
To claim a child as a dependent, they must meet the qualifying child test or
qualifying relative test
Ordinary dividends are taxed at the same rate as income tax rate.
ordinary
Distributions from HSA, Archer MSA, or MS MSA are non-taxable when
spent for qualified medical expenses of your dependent
,Which residency status is used when an individual is neither a U.S. citizen nor a
resident alien for tax purposes?
Non-resident alien
and are what taxpayers must know to calculate
their tax amount.
Taxable income and filing status
For mortgages entered into after December 15, 2017, the amount of interest the
taxpayer can deduct is no more than of the debt used to buy,
build, or substantially improve their principal home and a second home.
750,000
reduce the amount of tax due.
Ta x cred its
Which form is for beneficiaries who get income from trusts and estates?
Form 1041
consists of both earned and unearned income that is
used to calculate the tax. It is generally less than adjusted gross income due to
the deductions.
Taxable income
To satisfy the Substantial Presence Test, how many minimum days (in the
current year) must you be physically present ni the United States?
31
Complete the equation. = Selling Price - Purchase Price
Capital Loss or Capital Gain
helps sole proprietorships calculate the profit or loss from
a business while also providing the IRS with your total business income and
deductions.
Schedule C
What type of deduction is a HSA contribution?
,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 I R A
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
where the service is performed The general rule for sourcing wages and
personal services income si controlled by where hte service si performed. The
residence of the recipient of the service, the place of contracting, and hte time
and place of payment are irrelevant.
Which is considered non-taxable income?
military personnel allowances Payments received as a member of military
service are generally taxed as wages except for retirement pay, which si 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.
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?
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?
$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.
$1500 If yearly dividend amounts exceed $1500, a Schedule B must be
completed and attached.
The are filing statuses.
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).
$3,600.00 Taxpayers can claim a CTC of up to $3,600 for each child under age
71 ni 2021(2022). Since 2021, qualifying families may now receive up ot
$3,600 per child under hte age of 5and $3,000 for those ages 6ot 17. Thats' 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.
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?
Lines 25 through 30 are payments and refundable credits.
A partnership files a tax return on
