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HR BLOCK (TKA EXAM
PREP) QUESTIONS AND ANSWERS
IRC - correct answer- Internal Revenue Code
Standard Deduction - correct answer- Set by statute. Included
in calculating the Below-the-Line deductions (for Taxable
Income). Alternative is Itemized Deduction
Itemized Deduction - correct answer- Sum of allowable
deductions in calculating the Below-the-Line deductions (for
Taxable Income). Alternative is Standard Deduction
Tax Rate (Individuals) - Ordinary Income - correct answer- 10%
- 37%
Tax Rate (Individuals) - Net Gains / Qualified Dividends -
correct answer- 0% - 20% (sometimes) 20% - 28% (usually)
Alternative Minimum Tax Rate - correct answer- 26% - 28%
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Capital Gains - correct answer- Profit (or Loss) from the sale of
property or investments (preferential tax rate compared to
Ordinary Income)
Adjusted Gross Income (AGI) - correct answer- Gross Income -
Deductions
Taxable Income - correct answer- AGI - (Larger of Standard or
Itemized Deduction)
Tentative Tax - correct answer- Taxable Income (x) Tax Rate
Taxes Due (+) or Refund (-) - correct answer- Tentative Tax -
Credits
Refundable Tax Credit - correct answer- Taxpayer can receive
money through a refund
Nonrefundable Tax Credit - correct answer- Tax is lowered to a
possible $0. But no refund.
HR BLOCK (TKA EXAM
PREP) QUESTIONS AND ANSWERS
IRC - correct answer- Internal Revenue Code
Standard Deduction - correct answer- Set by statute. Included
in calculating the Below-the-Line deductions (for Taxable
Income). Alternative is Itemized Deduction
Itemized Deduction - correct answer- Sum of allowable
deductions in calculating the Below-the-Line deductions (for
Taxable Income). Alternative is Standard Deduction
Tax Rate (Individuals) - Ordinary Income - correct answer- 10%
- 37%
Tax Rate (Individuals) - Net Gains / Qualified Dividends -
correct answer- 0% - 20% (sometimes) 20% - 28% (usually)
Alternative Minimum Tax Rate - correct answer- 26% - 28%
, 2 | Page
Capital Gains - correct answer- Profit (or Loss) from the sale of
property or investments (preferential tax rate compared to
Ordinary Income)
Adjusted Gross Income (AGI) - correct answer- Gross Income -
Deductions
Taxable Income - correct answer- AGI - (Larger of Standard or
Itemized Deduction)
Tentative Tax - correct answer- Taxable Income (x) Tax Rate
Taxes Due (+) or Refund (-) - correct answer- Tentative Tax -
Credits
Refundable Tax Credit - correct answer- Taxpayer can receive
money through a refund
Nonrefundable Tax Credit - correct answer- Tax is lowered to a
possible $0. But no refund.
