Question 1

A taxable investment produced interest earnings of $1,200.A person in a 22 percent tax bracket would have after-tax earnings of:

Accepted Answer

A)  $1,200
B)  $936
C)  $780
D)  $264
E)  $22F) A) and B)
G) A) and E)

Question 2

Money received by an individual for personal effort is classified as ________ income.

Accepted Answer

A)  passive
B)  earned
C)  portfolio
D)  excluded
E)  investmentF) B) and E)
G) None of the above

Question 3

A person's filing status is affected by marital status and dependents.

Accepted Answer

A) True 
 B)False

Question 4

For 2018,which form would a married individual with less than $100,000 in taxable income use to file his federal income tax return?

Accepted Answer

A)  Form 1040X
B)  IRS Publication
C)  Form 1040
D)  Schedule A
E)  Schedule EF) A) and C)
G) A) and D)

Question 5

Which type of tax is imposed on specific goods and services,such as gasoline and cigarettes,at the time of purchase?

Accepted Answer

A)  Estate
B)  Inheritance
C)  Excise
D)  Gift
E)  Value-addedF) A) and C)
G) C) and E) C

Question 6

George Washburn had earnings from his salary of $32,000,interest on savings of $200,a contribution to a traditional individual retirement account of $1,200,and dividends from mutual funds of $125.George's adjusted gross income would be:

Accepted Answer

A)  $31,125.
B)  $32,000.
C)  $33,200.
D)  $33,400.
E)  $33,525.F) C) and E)
G) A) and D)

Question 7

Earnings from a limited partnership would be an example of ________ income.

Accepted Answer

A)  passive
B)  capital gain
C)  portfolio
D)  earned
E)  excludedF) A) and B)
G) A) and C)

Question 8

Joan Sanchez is single and earns $40,000 in taxable income.She uses the following tax rate schedule to calculate the taxes she owes.  What is Joan's marginal tax rate?

Accepted Answer

A)  10%
B)  12%
C)  22%
D)  24%
E)  between 10% and 12%F) B) and E)
G) All of the above

Question 9

The tax on $2,000 of profit on a capital asset is deferred. A person in a 24 percent tax bracket will have to pay what amount of taxes when the asset is sold?

Accepted Answer

A)  $2,000
B)  $1,500
C)  $760
D)  $480
E)  $24F) A) and C)
G) A) and E)

Question 10

A taxpayer with a taxable income of $45,328 and a total tax bill of $5,911 would have an average tax rate of ________ percent.

Accepted Answer

A)  10
B)  12
C)  13.04
D)  14.67
E)  22F) C) and D)
G) A) and B)

Question 11

A tax on the value of automobiles,boats,or furniture is referred to as:

Accepted Answer

A)  inheritance tax.
B)  estate tax.
C)  personal property tax.
D)  excise tax.
E)  general sales tax.F) B) and E)
G) A) and D)

Question 12

What are the advantages of a 401(K)?

Accepted Answer

Tax-deferred retirement plans such as 40...

Question 13

A tax ________ is an amount subtracted directly from the amount of taxes owed.

Accepted Answer

A)  credit
B)  reduction
C)  deduction
D)  exclusion
E)  shelterF) A) and B)
G) A) and C)

Question 14

Tax evasion is the use of illegal actions to reduce one's taxes.

Accepted Answer

A) True 
 B)False

Question 15

A ________ allows a taxpayer to put pre-tax dollars into an employer-sponsored program to cover medical expenses or child care costs.

Accepted Answer

A)  tax credit
B)  tax deduction
C)  flexible spending account
D)  tax deferred investment
E)  tax-exempt investmentF) A) and E)
G) B) and E)

Question 16

The state of Oklahoma imposes a tax of $.17 per gallon on gasoline.What type of tax is this most likely to be?

Accepted Answer

A)  Real estate tax
B)  Excise tax
C)  Personal property tax
D)  Income tax
E)  Estate taxF) A) and B)
G) None of the above

Question 17

To minimize taxes owed,you should do the following if you expect to have a higher tax rate next year:

Accepted Answer

A)  Accelerate the receipt of income into the current year.
B)  Delay the receipt of income until next year.
C)  Accelerate deductions into the current year.
D)  Get a loan for the additional taxes
E)  Quit work at the end of the current yearF) C) and E)
G) A) and E) A

Question 18

Itemized deductions are recorded on:

Accepted Answer

A)  W-2 form.
B)  Schedule A.
C)  Schedule B.
D)  Form 2106.
E)  Form 1040B.F) A) and C)
G) D) and E) B

Question 19

Haley Thomas has adjusted gross income of $40,000.She paid $4,700 in property taxes during the year.How much of the tax can she include as an itemized deduction?

Accepted Answer

A)  $4,700
B)  $4,000
C)  $3,000
D)  $700
E)  $0F) B) and C)
G) C) and D)

Question 20

The ________ property tax is based on the value of land and buildings.

Accepted Answer

A)  personal
B)  real estate
C)  direct
D)  proportional
E)  regressiveF) A) and E)
G) B) and D)

Exam 4: Planning Your Tax Strategy

A taxable investment produced interest earnings of $1,200.A person in a 22 percent tax bracket would have after-tax earnings of:

Correct AnswerverifiedShow Answer

Money received by an individual for personal effort is classified as ________ income.

Correct AnswerverifiedShow Answer

A person's filing status is affected by marital status and dependents.

Correct AnswerverifiedShow Answer

For 2018,which form would a married individual with less than $100,000 in taxable income use to file his federal income tax return?

Correct AnswerverifiedShow Answer

Which type of tax is imposed on specific goods and services,such as gasoline and cigarettes,at the time of purchase?

Correct AnswerverifiedC

George Washburn had earnings from his salary of $32,000,interest on savings of $200,a contribution to a traditional individual retirement account of $1,200,and dividends from mutual funds of $125.George's adjusted gross income would be:

Correct AnswerverifiedShow Answer

Earnings from a limited partnership would be an example of ________ income.

Correct AnswerverifiedShow Answer

Joan Sanchez is single and earns $40,000 in taxable income.She uses the following tax rate schedule to calculate the taxes she owes. What is Joan's marginal tax rate?

Correct AnswerverifiedShow Answer

The tax on $2,000 of profit on a capital asset is deferred. A person in a 24 percent tax bracket will have to pay what amount of taxes when the asset is sold?

Correct AnswerverifiedShow Answer

A taxpayer with a taxable income of $45,328 and a total tax bill of $5,911 would have an average tax rate of ________ percent.

Correct AnswerverifiedShow Answer

A tax on the value of automobiles,boats,or furniture is referred to as:

Correct AnswerverifiedShow Answer

What are the advantages of a 401(K)?

Correct AnswerverifiedTax-deferred retirement plans such as 40...View AnswerShow Answer

A tax ________ is an amount subtracted directly from the amount of taxes owed.

Correct AnswerverifiedShow Answer

Tax evasion is the use of illegal actions to reduce one's taxes.

Correct AnswerverifiedShow Answer

A ________ allows a taxpayer to put pre-tax dollars into an employer-sponsored program to cover medical expenses or child care costs.

Correct AnswerverifiedShow Answer

The state of Oklahoma imposes a tax of $.17 per gallon on gasoline.What type of tax is this most likely to be?

Correct AnswerverifiedShow Answer

To minimize taxes owed,you should do the following if you expect to have a higher tax rate next year:

Correct AnswerverifiedA

Itemized deductions are recorded on:

Correct AnswerverifiedB

Haley Thomas has adjusted gross income of $40,000.She paid $4,700 in property taxes during the year.How much of the tax can she include as an itemized deduction?

Correct AnswerverifiedShow Answer

The ________ property tax is based on the value of land and buildings.

Correct AnswerverifiedShow Answer

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Tax-deferred retirement plans such as 40...
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A

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B

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