Advanced Taxation Exam Materials
Course Introduction
Advanced Taxation delves into complex tax concepts, policies, and regulations affecting individuals, corporations, partnerships, and other entities. The course examines advanced topics such as international taxation, tax planning strategies, estate and gift taxation, corporate reorganizations, tax research, and ethical considerations. Emphasis is placed on the application of tax laws to real-world scenarios, interpretation of statutory provisions, and analysis of current tax issues, preparing students for roles in tax advisory, compliance, and consultancy.
Recommended Textbook
South western Federal Taxation 2017 Comprehensive Edition 40th Edition by William H. Hoffman
Available Study Resources on Quizplus
28 Chapters
3604 Verified Questions
3604 Flashcards
Source URL: https://quizplus.com/study-set/3572
Page 2
Chapter 1: An Introduction to Taxation and Understanding
the Federal Tax Law
Available Study Resources on Quizplus for this Chatper
159 Verified Questions
159 Flashcards
Source URL: https://quizplus.com/quiz/70946
Sample Questions
Q1) In 2012, José, a widower, sells land (fair market value of $100,000) to his daughter, Linda, for $50,000.José has made a taxable gift of $50,000.
A)True
B)False
Answer: False
Q2) Burt and Lisa are married and live in a common law state.Burt wants to make gifts to their five children in 2012.What is the maximum amount of the annual exclusion they will be allowed for these gifts?
A)$130,000.
B)$65,000.
C)$26,000.
D)$13,000.
E)None of the above.
Answer: A
Q3) The pay-as-you-go feature of the Federal income tax on individuals conforms to Adam Smith's canon of certainty.
A)True
B)False
Answer: False
To view all questions and flashcards with answers, click on the resource link above. Page 3
Chapter 2: Working With the Tax Law
Available Study Resources on Quizplus for this Chatper
85 Verified Questions
85 Flashcards
Source URL: https://quizplus.com/quiz/70934
Sample Questions
Q1) Which tax-related website probably gives the best policy-orientation results?
A)taxalmanac.org.
B)irs.gov.
C)taxsites.com.
D)taxanalyst.com.
E)ustaxcourt.gov.
Answer: D
Q2) A professional must understand the relative weight of authority within the sources of tax law.
A)True
B)False
Answer: True
Q3) Three judges will normally hear each U.S.Tax Court case.
A)True
B)False
Answer: False
Q4) A taxpayer can obtain a jury trial in the U.S.Court of Federal Claims.
A)True
B)False
Answer: False
To view all questions and flashcards with answers, click on the resource link above. Page 4
Chapter 3: Computing the Tax
Available Study Resources on Quizplus for this Chatper
150 Verified Questions
150 Flashcards
Source URL: https://quizplus.com/quiz/70925
Sample Questions
Q1) Kyle and Liza are married and under 65 years of age.During 2012, they furnish more than half of the support of their 19-year old daughter, May, who lives with them.She graduated from high school in May 2011. May earns $15,000 from a part-time job, most of which she sets aside for future college expenses.Kyle and Liza also provide more than half of the support of Kyle's cousin who lives with them.Liza's father, who died on January 3, 2012, at age 90, has for many years qualified as their dependent.How many personal and dependency exemptions should Kyle and Liza claim?
A)Two.
B)Three.
C)Four.
D)Five.
E)None of the above.
Answer: C
Q2) Keith, age 17 and single, earns $3,000 during 2012.Keith's parents cannot claim him as a dependent even if he does not live with them.
A)True
B)False
Answer: False
To view all questions and flashcards with answers, click on the resource link above.
Page 5
Chapter 4: Gross Income: Concepts and Inclusions
Available Study Resources on Quizplus for this Chatper
125 Verified Questions
125 Flashcards
Source URL: https://quizplus.com/quiz/70924
Sample Questions
Q1) Detroit Corporation sued Chicago Corporation for intentional damage to Detroit's goodwill.Detroit had created its goodwill through providing high-quality services to its customers.Thus, no basis for the goodwill appeared on Detroit's balance sheet.The suit was settled and Detroit received $1,500,000 for the damages to its goodwill.
A)The $1,500,000 is not taxable because it represents a recovery of capital.
B)The $1,500,000 is taxable because Detroit has no basis in the goodwill.
C)The $1,500,000 is not taxable because Detroit did nothing to earn the money.
D)The $1,500,000 is not taxable because Detroit settled the case.
E)None of the above.
Q2) Norma's income for 2012 is $27,000 from part-time work and $9,000 of Social Security benefits.Norma is not married.A portion of her Social Security benefits must be included in her gross income.
A)True
B)False
Q3) When stock is sold after the record date for a dividend that has been declared, the seller must recognize as income the dividend received.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above.
6
Chapter 5: Gross Income: Exclusions
Available Study Resources on Quizplus for this Chatper
116 Verified Questions
116 Flashcards
Source URL: https://quizplus.com/quiz/70923
Sample Questions
Q1) Julie was suffering from a viral infection that caused her to miss work for 90 days.During the first 30 days of her absence, she received her regular salary of $4,000 from her employer.For the next 60 days, she received $6,000 under an accident and health insurance policy purchased by her employer. The premiums on the health insurance policy were excluded from her gross income. During the last 30 days, Julie received $2,000 on an income replacement policy she had purchased. Of the $12,000 she received, Julie must include in gross income:
A)$0.
B)$4,000.
C)$8,000.
D)$10,000.
E)$12,000.
Q2) What are the tax problems associated with payments received by a wife from her deceased husband's employer? (Assume the wife renders no services to the employer.)
Q3) If a tax-exempt bond will yield approximately .65 (1 - .35) times the yield on a taxable bond of equal risk, who benefits from the tax exemption: the Federal government, the state and local governments who issue the bonds, or the investors?
Q4) What Federal income tax benefits are provided for college students?
To view all questions and flashcards with answers, click on the resource link above.
Page 7
Chapter 6: Deductions and Losses: in General
Available Study Resources on Quizplus for this Chatper
153 Verified Questions
153 Flashcards
Source URL: https://quizplus.com/quiz/70922
Sample Questions
Q1) Mitch is in the 28% tax bracket. He may receive a different tax benefit for a $2,000 expenditure that is classified as a deduction from AGI than he will receive for a $1,000 expenditure that is classified as a deduction for AGI.
A)True
B)False
Q2) Which of the following can be claimed as a deduction for AGI?
A)Personal casualty losses.
B)Investment interest expenses.
C)Moving expenses.
D)Property taxes on personal use real estate.
E)None of the above.
Q3) Trade and business expenses should be treated as:
A)A deduction from AGI subject to the 2%-of-AGI floor.
B)A deduction from AGI not subject to the 2%-of-AGI floor.
C)Deductible for AGI.
D)An itemized deduction if not reimbursed.
E)None of the above.
Q4) Describe the circumstances under which a taxpayer can receive rent income from a personal residence, but does not have to report it as gross income.
To view all questions and flashcards with answers, click on the resource link above. Page 8
Chapter 7: Deductions and Losses: Certain Business
Expenses and Losses
Available Study Resources on Quizplus for this Chatper
97 Verified Questions
97 Flashcards
Source URL: https://quizplus.com/quiz/70921
Sample Questions
Q1) Ivory, Inc., has taxable income of $600,000 and qualified production activities income (QPAI) of $700,000 in 2012.Ivory's domestic production activities deduction is:
A)$36,000.
B)$42,000.
C)$54,000.
D)$63,000.
E)None of the above.
Q2) Jim had a car accident in 2012 in which his car was completely destroyed.At the time of the accident, the car had a fair market value of $30,000 and an adjusted basis of $40,000.Jim used the car 100% of the time for personal use.Jim received an insurance recovery of 70% of the value of the car at the time of the accident.If Jim's AGI for the year is $60,000, determine his deductible loss on the car.
A)$900.
B)$2,900.
C)$3,000.
D)$9,000.
E)None of the above.
Q3) How is qualified production activities income (QPAI) calculated?
To view all questions and flashcards with answers, click on the resource link above. Page 9
Chapter 8: Depreciation, Cost Recovery, Amortization, and Depletion
Available Study Resources on Quizplus for this Chatper
116 Verified Questions
116 Flashcards
Source URL: https://quizplus.com/quiz/70920
Sample Questions
Q1) On March 1, 2012, Lana leases and places in service a passenger automobile.The lease will run for five years and the payments are $500 per month.During 2012, she uses her car 40% for business and 60% for personal activities.Assuming the dollar amount from the IRS table is $110, determine Lana's deduction for the lease payments.
A)$0.
B)$1,800.
C)$2,000.
D)$2,330.
E)None of the above.
Q2) Doug purchased a new factory building on January 15, 1988, for $400,000.On March 1, 2012, the building was sold.Determine the cost recovery deduction for the year of the sale assuming he did not use the MACRS straight-line method.
A)$0.
B)$1,587.
C)$2,645.
D)$12,696.
E)None of the above.
Q3) Discuss the reason for the inclusion amount with respect to leased automobiles.
To view all questions and flashcards with answers, click on the resource link above. Page 10
Chapter 9: Deductions: Employee and
Self-Employed-Related Expenses
Available Study Resources on Quizplus for this Chatper
166 Verified Questions
166 Flashcards
Source URL: https://quizplus.com/quiz/70919
Sample Questions
Q1) Both traditional and Roth IRAs possess the advantage of tax-free accumulation of income within the plan.
A)True
B)False
Q2) Kay, a single individual, participates in her employer's SIMPLE § 401(k) plan.The plan permits participants to contribute a percentage of their salary.Kay elects to contribute 5% of her annual salary of $111,000 to the plan.On what amount of her salary does Kay pay income taxes in 2012?
A)$5,550.
B)$11,500.
C)$105,450.
D)$111,000.
E)None of above.
Q3) A participant who is at least age 59 1/2 can make a tax-free qualified withdrawal from a Roth IRA after a five-year holding period.
A)True
B)False
Q4) How are combined business/pleasure trips treated for travel within the United States as opposed to foreign travel?
Page 11
To view all questions and flashcards with answers, click on the resource link above.
Chapter 10: Deductions and Losses: Certain Itemized
Deductions
Available Study Resources on Quizplus for this Chatper
106 Verified Questions
106 Flashcards
Source URL: https://quizplus.com/quiz/70945
Sample Questions
Q1) In 2005, Ross, who is single, purchased a personal residence for $170,000 and took out a mortgage of $100,000 on the property. In May of the current year, when the residence had a fair market value of $220,000 and Ross owed $70,000 on the mortgage, he took out a home equity loan for $110,000. He used the funds to purchase a BMW for himself and a Lexus SUV for his wife. For both vehicles, 100% of the use is for personal activities. What is the maximum amount on which Ross can deduct home equity interest?
Q2) The reduced deduction election enables a taxpayer to move from the 30%-of-AGI limitation to the 50%-of-AGI limitation.
A)True
B)False
Q3) For purposes of computing the deduction for qualified residence interest, a qualified residence includes only the taxpayer's principal residence.
A)True
B)False
Q4) Taxes assessed for local benefits, such as a new sidewalk, are not deductible as real property taxes.
A)True
B)False
Page 12
To view all questions and flashcards with answers, click on the resource link above.
Chapter 11: Investor Losses
Available Study Resources on Quizplus for this Chatper
103 Verified Questions
103 Flashcards
Source URL: https://quizplus.com/quiz/70944
Sample Questions
Q1) Chris receives a gift of a passive activity from his father whose basis was $60,000.Suspended losses related to the activity are $18,000.Chris will be allowed to offset the $18,000 suspended losses against future passive income.
A)True
B)False
Q2) Coyote Corporation has active income of $45,000 and a passive loss of $23,000 in the current year.Coyote cannot deduct the $23,000 loss if it is a personal service corporation.
A)True
B)False
Q3) Green, Inc., a closely held personal service corporation, has the following transactions in the current year: $100,000 of passive losses, $80,000 of active business income, and $20,000 of portfolio income.How much of the passive loss may Green use to offset other types of income this year?
Q4) Identify the types of income that are classified as investment income. Discuss the flexibility that a taxpayer has with respect to certain types of income that may potentially be considered investment income.
Q5) What special passive loss treatment is available to real estate activities?
To view all questions and flashcards with answers, click on the resource link above. Page 13
Chapter 12: Tax Credits and Payments
Available Study Resources on Quizplus for this Chatper
109 Verified Questions
109 Flashcards
Source URL: https://quizplus.com/quiz/70943
Sample Questions
Q1) The disabled access credit is computed at the rate of 50% of all access expenditures incurred by the taxpayer during the year.
A)True
B)False
Q2) Only self-employed individuals are required to make estimated tax payments.
A)True
B)False
Q3) Refundable tax credits include the:
A)Foreign tax credit.
B)Tax credit for rehabilitation expenses.
C)Credit for certain retirement plan contributions.
D)Earned income credit.
E)None of the above.
Q4) Susan generated $55,000 of net earnings from the conduct of a tax preparation business that she operated during the tax-filing season.She also received wages of $60,000 from her full-time job.Compute the self-employment taxes due for 2012.
Q5) All taxpayers are eligible to take the basic research credit.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 14
Chapter 13: Property Transactions: Determination of Gain or
Loss, Basis Considerations, and Nontaxable
Exchanges-Part 1
Available Study Resources on Quizplus for this Chatper
200 Verified Questions
200 Flashcards
Source URL: https://quizplus.com/quiz/70942
Sample Questions
Q1) Katie sells her personal use automobile for $15,000.She purchased the car four years ago for $31,000.What is Katie's recognized gain or loss?
A)$0.
B)$15,000.
C)($16,000).
D)($31,000).
E)None of the above.
Q2) If Wal-Mart stock increases in value during the tax year by $4,500, the amount realized is a positive $4,500.
A)True
B)False
Q3) Realized losses from the sale or exchange of stock are disallowed if within 30 days before or 30 days after the sale or exchange, the taxpayer acquires substantially identical stock.
A)True
B)False
Q4) The holding period for property acquired by gift is automatically long term.
A)True
B)False
Page 15
To view all questions and flashcards with answers, click on the resource link above.
Chapter 13: Property Transactions: Determination of Gain or
Loss, Basis Considerations, and Nontaxable
Exchanges-Part 2
Available Study Resources on Quizplus for this Chatper
92 Verified Questions
92 Flashcards
Source URL: https://quizplus.com/quiz/70941
Sample Questions
Q1) Under what circumstance is there recognition of some or all of the realized gain associated with the giving of boot by the taxpayer in a like-kind exchange?
Q2) Discuss the treatment of realized gains from involuntary conversions.
Q3) To be eligible to elect postponement of gain treatment for an involuntary conversion, what are the three tests for qualifying replacement property?
Q4) Discuss the application of holding period rules to property acquired by gift and inheritance.
Q5) After 5 years of marriage, Dave and Janet decided to get a divorce.As part of the divorce settlement, Janet transfers to Dave the house she purchased prior to their marriage.Janet's adjusted basis for the house is $125,000 and the fair market value is $200,000 on the date of the transfer.What are the tax consequences to Janet and to Dave as a result of the transfer?
Q6) Discuss the logic for mandatory deferral of realized gain or loss for a § 1031 like-kind exchange.
Q7) Define a bargain purchase of property and discuss the related tax consequences.
Q8) Can related parties take advantage of the like-kind exchange provisions?
Q9) Define qualified small business stock under § 1045. Page 16
Q10) What kinds of property do not qualify under the like-kind provisions?
To view all questions and flashcards with answers, click on the resource link above.
Page 17
Chapter 14: Property Transactions: Capital Gains and
Losses, 1231, Recapture Provisions
Available Study Resources on Quizplus for this Chatper
144 Verified Questions
144 Flashcards
Source URL: https://quizplus.com/quiz/70940
Sample Questions
Q1) An individual taxpayer received a valuable painting from his uncle, a famous painter. The painter did not create the painting, but had purchased it from another artist. After the taxpayer held the painting for two years, he sold it for a $400,000 gain. The gain is a long-term capital gain.
A)True
B)False
Q2) Section 1231 property includes nonpersonal use property where casualty losses exceed casualty gains for the taxable year.
A)True
B)False
Q3) The § 1245 depreciation recapture potential does not reduce the amount of the charitable contribution deduction under § 170.
A)True
B)False
Q4) In the "General Procedure for § 1231 Computation: Step 2.§ 1231 Netting," if the gains exceed the losses, the net gain is offset by the "lookback" nonrecaptured § 1231 losses.
A)True
B)False
Page 18
To view all questions and flashcards with answers, click on the resource link above.
Chapter 15: Alternative Minimum Tax
Available Study Resources on Quizplus for this Chatper
125 Verified Questions
125 Flashcards
Source URL: https://quizplus.com/quiz/70939
Sample Questions
Q1) Tammy expensed mining exploration and development costs of $100,000 incurred in 2012.She will be required to make negative AMT adjustments for each of the next nine years and a positive AMT adjustment in the current tax year.
A)True
B)False
Q2) Durell owns a construction company that builds residential housing.The company is eligible to use the completed contract method for regular income tax purposes.What can Durell do to minimize his AMT?
Q3) Which of the following statements is correct?
A)A C corporation classified as a small corporation is eligible to have the AMT calculated using the AMT provisions for individuals.
B)A C corporation classified as a small corporation is not subject to the AMT.
C)A C corporation classified as a small corporation is subject to the AMT only on its adjusted current earnings.
D)A C corporation classified as a small corporation is eligible to use the 15%/0% tax rate on net capital gain and qualified dividends rather than the regular tax rates applicable to other C corporations.
E)a., b., and c.are correct.
To view all questions and flashcards with answers, click on the resource link above.
Page 19
Chapter 16: Accounting Periods and Methods
Available Study Resources on Quizplus for this Chatper
87 Verified Questions
87 Flashcards
Source URL: https://quizplus.com/quiz/70938
Sample Questions
Q1) The accrual basis taxpayer sold land for $100,000 on December 31, 2012.He did not collect the $100,000 until January 2, 2013.The land was held as an investment.
A)If the accrual basis taxpayer's basis in the land was $110,000, the loss would be recognized in 2013.
B)If the accrual basis taxpayer's basis in the land was $60,000, the gain must be reported in 2012.
C)If the accrual basis taxpayer's basis in the land was $60,000, the gain must be reported in 2013, unless the taxpayer elects to not use the installment method.
D)The accrual basis taxpayer must recognize the gain or loss in the year of sale.
E)None of the above.
Q2) A C corporation provides lawn maintenance services to various businesses and homeowners. The corporation has average annual gross receipts of $3,500,000.The corporation may use the cash method of accounting.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 20
Chapter 17: Corporations: Introduction and Operating Rules
Available Study Resources on Quizplus for this Chatper
109 Verified Questions
109 Flashcards
Source URL: https://quizplus.com/quiz/70937
Sample Questions
Q1) If a C corporation uses straight-line depreciation on real estate (§ 1250 property), no gain on the sale of the property will be recaptured as ordinary income. A)True
B)False
Q2) Quail Corporation is a C corporation with net income of $125,000 during the current year.If Quail paid dividends of $25,000 to its shareholders, the corporation must pay tax on $100,000 of net income.Shareholders must report the $25,000 of dividends as income. A)True
B)False
Q3) Ed, an individual, incorporates two separate businesses that he owns by establishing two new corporations.Each corporation generates taxable income of $50,000.Each corporation will have a tax liability of $7,500. A)True B)False
Q4) Explain the rules regarding the accounting periods available to corporate taxpayers.
Q5) Briefly describe the accounting methods available for adoption by a C corporation.
To view all questions and flashcards with answers, click on the resource link above.
Chapter 18: Corporations: Organization and Capital Structure
Available Study Resources on Quizplus for this Chatper
93 Verified Questions
93 Flashcards
Source URL: https://quizplus.com/quiz/70936
Sample Questions
Q1) Joe and Kay form Gull Corporation.Joe transfers cash of $250,000 for 200 shares in Gull Corporation.Kay transfers property with a basis of $50,000 and fair market value of $240,000.She agrees to accept 200 shares in Gull Corporation for the property and for providing bookkeeping services to the corporation in its first year of operation.The value of Kay's services is $10,000.With respect to the transfer:
A)Gull Corporation has a basis of $240,000 in the property transferred by Kay.
B)Neither Joe nor Kay recognizes gain or income on the exchanges.
C)Gull Corporation has a business deduction under § 162 of $10,000.
D)Gull capitalizes $10,000 as organizational costs.
E)None of the above.
Q2) Because services are not considered property under § 351, a taxpayer must report as income the fair market value of stock received for such services.
A)True
B)False
Q3) When depreciable property is transferred to a controlled corporation under § 351, any recapture potential disappears and does not carry over to the corporation.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 22
Chapter 19: Corporations: Distributions Not in Complete
Liquidation
Available Study Resources on Quizplus for this Chatper
145 Verified Questions
145 Flashcards
Source URL: https://quizplus.com/quiz/70935
Sample Questions
Q1) Five years ago, Eleanor transferred property she had used in her sole proprietorship to Blue Corporation for 1,000 shares of Blue Corporation in a transaction that qualified under § 351.The assets had a tax basis to her of $100,000 and a fair market value of $270,000 on the date of the transfer.In the current year, Blue Corporation (E & P of $800,000) redeems 250 shares from Eleanor for $220,000 in a transaction that does not qualify for sale or exchange treatment.With respect to the redemption, Eleanor will have a:
A)$195,000 capital gain.
B)$220,000 capital gain.
C)$195,000 dividend.
D)$220,000 dividend.
E)None of the above.
Q2) Cash distributions received from a corporation with a positive balance in accumulated E & P at the beginning of the year will be taxed as dividend income.
A)True
B)False
Q3) For tax purposes, all stock redemptions are treated as dividend distributions.
A)True
B)False
Page 23
To view all questions and flashcards with answers, click on the resource link above.
Chapter 20: Corporations: Distributions in Complete
Liquidation and an Overview of Reorganizations
Available Study Resources on Quizplus for this Chatper
70 Verified Questions
70 Flashcards
Source URL: https://quizplus.com/quiz/70933
Sample Questions
Q1) Since debt security holders do not own stock, they do not fall under the corporate reorganization rules.
A)True
B)False
Q2) The gains shareholders recognize as a part of a corporate reorganization may be treated a dividend to the extent of the corporation's E & P.
A)True
B)False
Q3) For a corporate restructuring to qualify as a tax-free reorganization, the transaction must have a sound business purpose.
A)True
B)False
Q4) As a general rule, a liquidating corporation recognizes gains but not losses on the distribution of property in complete liquidation.
A)True
B)False
Q5) Compare the sale of a corporation's assets with a sale of its stock from the perspective of the seller.
To view all questions and flashcards with answers, click on the resource link above. Page 24
Chapter 21: Partnerships
Available Study Resources on Quizplus for this Chatper
159 Verified Questions
159 Flashcards
Source URL: https://quizplus.com/quiz/70932
Sample Questions
Q1) Which of the following partnership owners is personally liable for the entity's debts to general creditors?
A)A partner in a limited liability partnership.
B)A member of a limited liability company.
C)A limited partner in a limited partnership.
D)A general partner in a limited partnership.
E)None of these owners are personally liable for entity debts.
Q2) A partnership has accounts receivable with a basis of $0 and a fair market value of $20,000 and depreciation recapture potential of $30,000.All other assets of the partnership are either cash, capital assets, or § 1231 assets.If a purchaser acquires a 40% interest in the partnership from another partner, the selling partner will be required to recognize ordinary income of $20,000.
A)True
B)False
Q3) Section 721 provides that, in general, no gain or loss is recognized by the partnership or the partner on contribution of appreciated or depreciated property to a partnership in exchange for an interest in the partnership.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above.
Page 25
Chapter 22: S: Corporations
Available Study Resources on Quizplus for this Chatper
159 Verified Questions
159 Flashcards
Source URL: https://quizplus.com/quiz/70931
Sample Questions
Q1) The § 1374 tax is a corporate-level tax on any built-in gain recognized in 2012 when an S corporation disposes of an asset in a taxable disposition within 10 tax years after the date on which the S election took effect.
A)True
B)False
Q2) An item that appears in the "Other Adjustments Account" affects stock basis, but not AAA, such as tax-exempt interest.
A)True
B)False
Q3) When loss assets are distributed by an S corporation, a shareholder's basis is equal to the asset's fair market value.
A)True
B)False
Q4) Outline the requirements that an entity must meet to elect S corporation status.
Q5) An S corporation that has total assets of at least $7.5 million on Schedule L at the end of the tax year must file a Schedule M-3.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 26
Chapter 23: Exempt Entities
Available Study Resources on Quizplus for this Chatper
151 Verified Questions
151 Flashcards
Source URL: https://quizplus.com/quiz/70930
Sample Questions
Q1) Which of the following requirements must be satisfied for a bingo game to be classified as not being an unrelated trade or business?
A)The bingo game is legal under both state and local law.
B)The bingo game is conducted by volunteers.
C)For-profit bingo games ordinarily are not permitted in the jurisdiction.
D)Only a.and b.must be satisfied.
E)Only a.and c.must be satisfied.
Q2) An exempt organization is located in the state of Nevada.Gambling in Nevada is legal.Therefore, bingo games are conducted by both taxable and tax-exempt organizations.If the net earnings from the bingo games are less than $25,000, the exempt organization is not subject to the unrelated business income tax (UBIT).
A)True
B)False
Q3) The excise tax imposed on a private foundation's excess business holdings is in effect an audit fee to defray IRS expenses.
A)True
B)False
Q4) Why are some organizations exempt from Federal income tax?
To view all questions and flashcards with answers, click on the resource link above. Page 27
Chapter 24: Multistate Corporate Taxation
Available Study Resources on Quizplus for this Chatper
145 Verified Questions
145 Flashcards
Source URL: https://quizplus.com/quiz/70929
Sample Questions
Q1) In unitary states, a(n) ____________________ provision permits a multinational corporation to elect to limit the reach of the state's taxing jurisdiction to activities occurring within the boundaries of the United States.
Q2) Slattery Corporation sells widgets in two states. State A levies a 9% effective tax rate, and State B levies a 4% rate. A and B have adopted sales-factor-only apportionment formulas. To reduce overall multistate income tax liabilities, Slattery should:
A) Remove all stored inventory from A.
B) Establish a personal training center in A.
C) Move its home office from B to A.
D) Convert to employee status the independent contractors that it uses to sell widgets in A.
Q3) The individual seller of a used auto should collect and remit sales tax to the state.
A)True B)False
Q4) Most states waive the collection of sales tax on medical equipment.
A)True B)False
To view all questions and flashcards with answers, click on the resource link above.
Chapter 25: Taxation of International Transactions
Available Study Resources on Quizplus for this Chatper
148 Verified Questions
148 Flashcards
Source URL: https://quizplus.com/quiz/70928
Sample Questions
Q1) The transfer of the assets of a U.S.corporation's foreign branch to a newly formed foreign corporation is always tax deferred under § 351.
A)True
B)False
Q2) The "residence of seller" rule is used in determining the sourcing of all gross income and deductions of a U.S.multinational business.
A)True
B)False
Q3) Which of the following is not a specific separate income "basket" for purposes of the foreign tax credit limitation calculation?
A)Intangibles income.
B)Passive income.
C)Business income.
D)None of the above are separate FTC limitation baskets.
E)All of the above are separate FTC limitation baskets.
Q4) Your client holds foreign tax credit (FTC) carryforwards, i.e., it is in an "excess credit" position. Give at least three planning ideas that the client should implement, so as to free up the suspended FTCs.
To view all questions and flashcards with answers, click on the resource link above.
Page 29
Chapter 26: Tax Practice and Ethics
Available Study Resources on Quizplus for this Chatper
147 Verified Questions
147 Flashcards
Source URL: https://quizplus.com/quiz/70927
Sample Questions
Q1) Circular 230 requires that the tax practitioner use the "best practices" of the tax profession in carrying out a tax engagement. Specify what some of these best practices entail.
Q2) Currently, the IRS charges a ____________________% interest rate on taxes that the taxpayer underpays. or
Q3) A(n) ____________________ should be requested when the taxpayer wants to know the IRS interpretation of how the tax law will be applied to a proposed transaction.
Q4) A taxpayer's return might be selected for audit on the basis of the ____________________ score that the IRS computes.
Q5) A CPA and his/her client hold a privilege of confidentiality from the IRS, as to their discussions about completing a tax return. A)True B)False
Q6) Certain individuals are more likely than others to have the Form 1040 audited by the IRS. List at least five factors that may increase above the national norms one's chances of audit.
Q7) The IRS is a subsidiary agency of the Department of the
Page 30
To view all questions and flashcards with answers, click on the resource link above.
Chapter 28: Income Taxation of Trusts and Estates
Available Study Resources on Quizplus for this Chatper
145 Verified Questions
145 Flashcards
Source URL: https://quizplus.com/quiz/70926
Sample Questions
Q1) ____________________ is the maximum amount that can be included in the beneficiaries' gross incomes from the fiduciary for the year.
Q2) The Zhao Estate generated distributable net income (DNI) this year of $100,000, one-fourth of which was tax-exempt interest, and the balance of which was long-term capital gain.Kyle Zhao, the sole income beneficiary of the estate, received a distribution of the entire $125,000 accounting income of the entity.How does Kyle report the distribution?
A)$75,000 long-term capital gain, $25,000 exempt interest.
B)$50,000 long-term capital gain, $50,000 exempt interest.
C)$75,000 long-term capital gain, $25,000 ordinary income.
D)$93,750 long-term capital gain, $31,250 exempt interest.
Q3) The depreciation deductions of a trust usually are allocable to ____________________ beneficiaries. or
Q4) You are responsible for the Federal income tax filings of the Tyrone Trust. Summarize the relevant due dates and filing requirements for Tyrone.
Q5) Identify the parties that are present when an estate is created, and their key duties. Then do the same for a trust.
To view all questions and flashcards with answers, click on the resource link above. Page 31