Test Bank for Income Tax Fundamentals 38th Edition | Whittenburg, Buller, Gill

TEST BANK: Y




INCOME TAX FUN Y Y




DAMENTALS,38T Y




H EDITION, GERAL
Y Y




D E. WHITTENBUR
Y Y




G, MARTHA ALTU
Y Y




S-
BULLER, STEVEN
Y Y Y




GILL

,Chapter 1: The Individual Income Tax Return
Y Y Y Y Y Y




1. AY corporationY isY aY reportingY entityY butY notY aY tax-
payingY entity.Y TrueYFalse



2. PartnershipYcapitalYgainsYandYlossesYareYallocatedYseparatelyYtoYeachYofYtheYpartners.YTrueYFalse




3. MarriedYtaxpayersYmayYdoubleYtheirYstandardYdeductionYamountYbyYfilingYseparateYreturns.

TrueY False



4. AnY itemY isYnotY includedYinY grossY incomeYunlessYtheYtaxYlawYspecifiesYthatYtheY itemY isYsubjectYtoY
taxation.
TrueY False



5. ForYtaxpayersYwhoYdoYnotYitemizeYdeductions,YtheYstandardYdeductionYamountYisYsubtractedY
fromYtheYtaxpayer'sYadjustedYgrossYincome.
TrueY False



6. AYtaxpayerYwithYself-
employmentYincomeYofY$600YmustYfileYaYtaxYreturn.YTrue False



7. AY dependentY childY withY earnedY incomeY inY excessY ofY theY availableY standardY deductionY amountY
mustYfileYaYtaxYreturn.
TrueY False



8. AYsingleYtaxpayer,YwhoYisYnotYblindYandYwhoYisYunderYageY65,YwithYincomeYofY $8,750YmustYfileYaY
taxYreturn.
TrueY False

,9. IfYzaYztaxpayerYzisYzdueYzaYzrefund,YzitYzwillYzbeYzmailedYztoYztheYztaxpayerYzregardlessYzofYzwhetherYzheYzorY
zsheYzfilesYzaYztaxYzreturn.Yz
TrueYzYzFalseYz



10. TaxpayersYzwithYzself-employmentYzincomeYzofYz$400YzorYzmoreYzmustYzfileYzaYztaxYzreturn.Yz
True False



11. IfYzyourYzspouseYzdiesYzduringYztheYztaxYzyearYzandYzyouYzdoYznotYzremarry,YzyouYzmustYzfileYzasY
zsingleYzforYztheYzyearYzofYzdeath.Yz
TrueYzYzFalseYz



12. TaxpayersY zwhoY zdoY znotY zqualifyY zforY zmarried,Y zheadY zofY zhousehold,Y zorY zqualifyingY zwidowY zorY
zwidowerYzfilingYzstatusYzmustYzfileYzasYzsingle.Yz
TrueYzYzFalseYz



13. IfYzanYzunmarriedYztaxpayerYzpaidYzmoreYzthanYzhalfYztheYzcostYzofYzkeepingYzaYzhomeYzwhichYzisYztheYzp
rincipalYzplaceYzofYzresidenceYzofYzaYznephew,YzwhoYzisYznotYzherYzdependent,YzsheYzmayYzuseYztheYzheadYzo
fYzhouseholdYzfilingYzstatus.Yz
TrueYzYzFalseYz



14. TheYzmaximumYzofficialYzindividualYzincomeYztaxYzrateYzforYz2012YzisYz35Yzpercent.Yz
True False



15. AllY ztaxpayersY zmayY zuseY ztheY ztaxY zrateY zscheduleY ztoY zdetermineY ztheirY ztaxY zliability.Y
zTrueYzFalseYz




16. TheYzheadYzofYzhouseholdYztaxYzratesYzareYzhigherYzthanYztheYzratesYzforYzaYzsingleYztaxpayer.Y
zTrueYzFalseYz




17. MostYzstatesYzareYzcommunityYzpropertyYzstates.Yz
TrueY False

, 18. IfYztaxpayersYzareYzmarriedYzandYzlivingYztogetherYzatYztheYzendYzofYztheYzyear,YztheyYzmustYzfileYzaY
zjointYztaxYzreturn.Yz
TrueYzYzFalseYz



19. AY ztaxpayerY zwhoY zmaintainsY zaY zhouseholdY zwithY zanY zunmarriedY zchildY zmayY zqualifyY ztoY zfileY zasY
zheadYzofYzhouseholdYzevenYzifYztheYzchildYzisYznotYztheYztaxpayer'sYzdependent.Yz
TrueYzYzFalseYz



20. AYzmarriedYzpersonYzwithYzaYzdependentYzchildYzmayYzchooseYztoYzfileYzasYzheadYzofYzhouseholdYzifYzitY
zreducesYzhisYzorYzherYztaxYzliability.Yz
TrueYzYzFalseYz



21. AYztaxpayerYzwhoYzisYzlivingYzaloneYzandYzisYzlegallyYzseparatedYzfromYzhisYzorYzherYzspouseYzunderYzaY
zseparateYzmaintenanceYzdecreeYzatYzyear-endYzshouldYzfileYzasYzsingle.Yz
TrueYzYzFalseYz



22. AnYzindividual,YzageYz22,YzenrolledYzonYzaYzfull-
timeYzbasisYzatYzaYztradeYzschool,YzisYzconsideredYzaYzstudentYzforYzpurposesYzofYzdeterminingYzwhetherY
zaYzdependencyYzexemptionYzisYzpermitted.YzTrueYzFalseYz




23. AY zdependencyY zexemptionY zmayY zbeY zclaimedY zbyY ztheY zsupportingY ztaxpayerY zinY ztheY zyearY zofY
zdeathYzofYzaYzdependent.Yz
TrueYzYzFalseYz



24. ForYz2012,YzpersonalYzandYzdependencyYzexemptionsYzareYz$3,800Yzeach.Yz
True False



25. zScholarshipsYzreceivedYzbyYzaYzstudentYzmayYzbeYzexcludedYzforYzpurposesYzofYztheYzsupportYztestYzforY
zdeterminingYztheYzavailabilityYzofYztheYzdependencyYzexemption.
True False