Final Exam > Results Page
final exam score:
80%
Question 1
Incorrect
Alternative minimum tax for individuals requires certain adjustments and preferences. Which of the following is a preference or adjustment item for noncorporate taxpayers?
Personal exemptions
(You Answered) Incentive stock options
Tax-exempt interest on private activity bonds issued after August 7, 1986 (other than interest on bonds issued in 2009 and 2010)
(Correct Answer) All of the above
Question 2
Incorrect
With respect to the alternative minimum tax for individuals, all of the following are tax preference items except:
Depletion (after the tax-free recovery of basis)
Tax-exempt interest on private activity bonds issued after August 7, 1986 (other than interest on bonds issued in 2009 and 2010)
Intangible drilling costs (in excess of 65% of net income from the properties)
(Correct Answer) Casualty loss from Schedule A
Question 3
Correct
Which of the following is a tax preference item?
Incentive stock option (ISO) spread
(You Answered) (Correct Answer) Interest on tax-exempt private activity bonds (other than interest on bonds issued in 2009 and 2010)
Miscellaneous itemized deductions
Certain medical deductions
Question 4
Correct
The AMT exemption amount for a married couple filing jointly in 2012 is:
$39,375
$48,450
$50,600
(You Answered) (Correct Answer) $78,750
Question 5
Correct
The top AMT rate for 2012 for individuals is:
25%
26%
(You Answered) (Correct Answer) 28%
35%
Question 6
Correct
The minimum tax credit for individuals applies only with respect to which of the following items?
(You Answered) (Correct Answer) Certain depreciation
Home mortgage interest used for any purpose other than to buy, build, or substantially improve a principal residence or second home
Miscellaneous itemized deductions
Medical expenses deducted for regular tax purposes not in excess of 10% of AGI
Question 7
Incorrect
Which of the following is deductible for AMT purposes?
Miscellaneous itemized deductions
(Correct Answer) Charitable contributions
Personal exemptions
State and local taxes
Question 8
Incorrect
If an individual is liable for self-employment tax, slightly better than one-half of the self-employment tax in 2012 is deductible as:
A Schedule C business expense
An itemized deduction
(Correct Answer) A deduction in arriving at adjusted gross income
It is nondeductible.
Question 9
Correct
The maximum amount on which the Social Security portion of self-employment tax is figured in 2012 is:
$102,000
$106,800
(You Answered) (Correct Answer) $110,100
Unlimited
Question 10
Incorrect
Self-employment tax applies to all of the following except:
(You Answered) Net earnings from a sole proprietorship
A distributive share from a consulting firm operating as a partnership
(Correct Answer) A distributive share from an investment club
Net earnings from an LLC
Question 11
Incorrect
Edie Williams earns $110,100 from her day job. She also has a sideline business that nets $10,000. For self-employment tax purposes:
(You Answered) There is no additional tax because she paid all of her Social Security and Medicare taxes at her job.
(Correct Answer) She owes Medicare taxes only on the $10,000.
She owes Social Security taxes only on the $10,000.
She owes both Social Security and Medicare taxes on the $10,000.
Question 12
Correct
Which of the following statements is not true regarding the kiddie tax in 2012?
(You Answered) (Correct Answer) Regardless of the amount of a child’s unearned income, the parent can elect to report it on his own return.
It does not apply to the first $1,900 of unearned income of a child under the kiddie tax age limit.
It applies only with respect to unearned income of a child under the kiddie tax age.
It is figured using Form 8615.
Question 13
Correct
A child subject to the kiddie tax has unearned income over $1,900. All of the following are conditions for a parent to elect to report a child’s unearned income on his tax return in 2012 except:
The child made no estimated tax payments and is not subject to backup withholding.
The child’s income consists only of interest, dividends, and/or capital gain distributions.
(You Answered) (Correct Answer) The child did not file a tax return for the prior year.
The child has no earned income.
Question 14
Correct
For purposes of the kiddie tax, a child’s investment income can be reduced by directly connected itemized deductions (subject to the 2% AGI floor) that include all of the following except:
Custodial fees
Service fees to collect interest and dividends
Investment counsel fees
(You Answered) (Correct Answer) Tax preparation fees
Question 15
Correct
The AMT exemption amount for a child subject to the kiddie tax in 2012 may not exceed earned income plus:
$6,400
$6,700
$6,800
(You Answered) (Correct Answer) $6,950