WGU C237 - TAXATION 1
What is an example of a credit that is a refundable tax credit? - ANSWERS-Earned
income credit
Which mortgage interest expense is a reduction for AGI? - ANSWERS-Rental home
What is a role of deductions from AGI, excluding the qualified business income
deduction (QBI)? - ANSWERS-It allows deduction of retirement contributions
What is an example of something that is deductible as an investment expense? -
ANSWERS-Interest on a loan to purchase land for an investment?
What is an example of an item that is deductible as a business expense if a doctor
invests personal money in various properties? - ANSWERS-Property taxes paid on
a medical office.
A taxpayer runs an automotive repair business in a building he owns. The income
and expenses are reported on Form 1040, Schedule C. There was no section 179
election made. What is an example of an action that represents a deductible
business expense for the current tax year and is therefore not subject to
capitalization and depreciation? - ANSWERS-Repairing a leak in the roof of the
building.
, What year was the US income tax on individuals permanently established? -
ANSWERS-1913
What is the second-highest level of legislative authority of tax law in the United
States? - ANSWERS-Internal Revenue Code
In which publications does the IRS provide information on the tax consequences
of specific transactions encountered in practice? - ANSWERS-Revenue Rulings
How are tax systems evaluated in terms of equity? - ANSWERS-Each taxpayer pays
a different amount based on their income level
What is horizontal equity? - ANSWERS-When two taxpayers in similar situations
pay the same tax.
What is the nature of a progressive tax rate structure? - ANSWERS-The rate of tax
increases as the tax base increases.
Which tax rate structure is exemplified by the FICA portion of Social Security
taxes? - ANSWERS-Regressive
Which tax is based on the value of an individual's real estate? - ANSWERS-
Property tax
What is an example of a credit that is a refundable tax credit? - ANSWERS-Earned
income credit
Which mortgage interest expense is a reduction for AGI? - ANSWERS-Rental home
What is a role of deductions from AGI, excluding the qualified business income
deduction (QBI)? - ANSWERS-It allows deduction of retirement contributions
What is an example of something that is deductible as an investment expense? -
ANSWERS-Interest on a loan to purchase land for an investment?
What is an example of an item that is deductible as a business expense if a doctor
invests personal money in various properties? - ANSWERS-Property taxes paid on
a medical office.
A taxpayer runs an automotive repair business in a building he owns. The income
and expenses are reported on Form 1040, Schedule C. There was no section 179
election made. What is an example of an action that represents a deductible
business expense for the current tax year and is therefore not subject to
capitalization and depreciation? - ANSWERS-Repairing a leak in the roof of the
building.
, What year was the US income tax on individuals permanently established? -
ANSWERS-1913
What is the second-highest level of legislative authority of tax law in the United
States? - ANSWERS-Internal Revenue Code
In which publications does the IRS provide information on the tax consequences
of specific transactions encountered in practice? - ANSWERS-Revenue Rulings
How are tax systems evaluated in terms of equity? - ANSWERS-Each taxpayer pays
a different amount based on their income level
What is horizontal equity? - ANSWERS-When two taxpayers in similar situations
pay the same tax.
What is the nature of a progressive tax rate structure? - ANSWERS-The rate of tax
increases as the tax base increases.
Which tax rate structure is exemplified by the FICA portion of Social Security
taxes? - ANSWERS-Regressive
Which tax is based on the value of an individual's real estate? - ANSWERS-
Property tax
