Test Bank for South-Western Federal Taxation 2025 Individual Income Taxes, 48th Edition by James C. Young Fully Covered Complete Chapters Newest Version

TEST BANKu




South-Western Federal Taxation 2025:
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Individual Income Taxes, 48th Edition by
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James Young Complete Chapters 1 - 20
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Pageu 1

,TABLEOFCONTENTS

Chapter 1: An Introduction to Taxation and Understanding the Federal Tax LawChapter 2
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: Working with the Tax Law
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Chapter 03: Tax Formula and Tax Determination Chapter
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04: Gross Income: Concepts and InclusionsChapter 05: G
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ross Income: Exclusions
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Chapter 06: Deductions and Losses: In General
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Chapter 07: Deductions and Losses: Certain Business Expenses Chapter
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08: Depreciation, Cost Recovery, Amortization, and Depletion Chapter 09
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: Deductions: Employee and Self-Employed-
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Related ExpenseChapter 10: Deductions and Losses: Certain Itemized D
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eductions Chapter 11: Investor Losses u u u u




Chapter 12: Alternative Minimum Tax
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Chapter 13: Tax Credits and Payment Procedures
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Chapter 14: Property Transactions: Determination of Gain or Loss andChap
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ter 15: Property Transactions: Nontaxable Exchanges
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Chapter 16: Property Transactions: Capital Gains and Losses Chapt
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er 17: Property Transactions: 1231 and Recapture ProvisionsChapter
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18: Accounting Periods and Methods
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Chapter 19: Deferred Compensation Chapt
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er 20: Corporations and Partnerships
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Pageu 2

, Chapteru 01u 20252uIndividuals

Answers2at2the2end2of2each2chapter

Indicateuuwhetheru theu statementu is2utrueu oru false.
u u1.uSalesumadeuoverutheuinternetuareunot2exempt2fromutheuapplicationuofuaugeneralusalesu(oruuse)utax.
a. True
b. False

u u2.uUponuauditubyutheuIRS,uFaithuisuassesseduaudeficiencyuofu$40,000uofuwhichu$25,000uisuattributableutounegligence.
The220%unegligenceupenaltyuwilluapplyutou$25,000.
a. True
b. False

u u3.uUltimately,umostutaxesuareupaidubyuindividuals.
a. True
b. False

u u4.uEvenuifupropertyutaxuratesuareunot2changed,utheuamountuofuaduvalorem2taxesuimposeduonurealtyumayunoturemaintheusame.
a. True
b. False

u u5.uTheuprincipaluobjectiveuofutheuFUTA2tax2isutouprovideusomeumeasureuofuretirementusecurity.
a. True
b. False

u

u6.uIfumoreuIRSuauditsuareuproducinguauhigherunumberuofunouchangeuresults,uthisuindicatesuincreaseducomplianceuonthe2up

artuofutaxpayers.
a. True
b. False

u

u7.uAusafe2andueasyuwayuforuautaxpayerutouavoidulocaluandustateusalesutaxesuisutoumakeutheupurchaseuinuaustate2 thatlevuie

sunousuchutaxes.
a. True
b. False

u

u8.uA2calendaruyearutaxpayerufilesuhisu2023uFederaluincomeutaxureturnuonuMarchu4,u2024.uTheureturnureflects2anuoverpayum

ent2ofu$6,000,uandutheutaxpayerurequestsuaurefunduofuthisuamount.uTheurefunduisupaiduonuMayu16,u2024.Theurefunduneedunot2uincl
udeuinterest.
a. True
b. False

u u9.uAutax2cutuenactedubyuCongressuthatucontainsuau sunsetu provisionuwillumake2theutaxucututemporary.
a. True
b. False


Pageu 3

, Name: Class: Date:uu

Chapteru 01u 2025u Individuals

u 10.uForuFederaluincomeutax2purposes,uthereuneveruhasubeenuaugeneraluamnestyuperiod.
u

a. True
b. False

u

11.uToulessenuorueliminateutheueffectuofumultipleutaxation,uautaxpayeruwho2isusubject2toubothuforeignuanduU.S.uincomeutaxeusu
u

onuthe2sameuincomeuisuallowedueitheruaudeductionuoruaucredit2forutheuforeignutaxupaid.
a. True
b. False

u

12.uBecauseuit2isuconsistentuwithutheuwherewithalutoupayuconcept,utheutaxulawurequiresuausellerutourecognizeuaugainuintheuy
u

earutheuinstallmentusaleuoccurs.
a. True
b. False

u 13.uThe2amountuofuautaxpayer’s2itemizedudeductionsuwilluincreaseutheuchance2ofubeinguauditedubyutheuIRS.
u

a. True
b. False

u

u14.uInu2024,uJosé,uauwidower,usellsulandu(fairumarketuvalueuofu$100,000)utouhisudaughter,uLinda,uforu$50,000.uJoséuhas2not2u

madeuautaxableugift.
a. True
b. False

u

u15.uForuomissionsufromugrossuincomeuinuexcessuofu25%uofuthat2reported,uthereuisuno2statuteuofulimitationsuonuadud

itionaluincomeutaxuassessmentsubyutheuIRS.
a. True
b. False

u 16.uStealthutaxesuhave2theueffect2ofugeneratinguadditionalutaxesufromuallutaxpayers.
u

a. True
b. False

17.uJason’subusinessuwarehouseuisudestroyedubyufire.uBecauseutheuinsuranceuproceedsuexceedutheubasisuofutheupropertuy
uuuuuuu u

,uaugainuresults.uIfuJasonushortlyureinvestsutheuproceedsuinuaunewuwarehouse,uno2gainuisurecognizedudue2toutheuapplicationuofutuheu
wherewithaluto2payuconcept.
a. True
b. False

u 18.uAnuinheritance2taxuisuautax2onuaudecedent’surightuto2passupropertyuatudeath.
u

a. True
b. False

u 19.uWhenuinterest2isuchargeduonuaudeficiency,uanyupart2ofuaumonthucountsuas2aufullumonth.
u

a. True
Pageu 4