Final Exam > Results Page
final exam score:
100%
Question 1
Correct
The "one-two punch" in the text refers to:
Combining tax liabilities for two types of IRAs.
Adjusting to life without salary income as well as dependence on taxable retirement benefits.
(You Answered) (Correct Answer) Greater amount of social security benefits includible in gross income as well as increases in other types of income.
None of the above.
Question 2
Correct
Higher-income taxpayers include in gross income up to _____ percent of the excess of their modified AGI for the year or of the social security benefits received.
35
60
75
(You Answered) (Correct Answer) 85
Question 3
Correct
All of the following federal income tax deductions are based on the level of the taxpayer’s adjusted gross income except:
(You Answered) (Correct Answer) Mortgage interest
Medical expenses
Casualty or theft losses
Charitable contributions
Question 4
Correct
Regarding "taxable accounts," in 2012 which of the following statements is true?
Sales of investments in taxable accounts that result in capital losses can reduce taxable income by up to $5,000 a year.
(You Answered) (Correct Answer) Generally, gain from the sale of long-term capital assets is subject to a maximum capital gains tax rate of 15% for high-income taxpayers.
'Qualified dividend income' is subject to a maximum tax rate of 20%.
When an individual sells an investment in a taxable account, the entire amount of the sales proceeds is included in the taxpayer’s income.
Question 5
Correct
Under the Pension Protection Act of 2006, which of the following statements is (are) correct?
After 2007, distributions from certain qualified plans and annuities can be rolled over directly into a Roth IRA.
Distributions from a decedent's plan can be rolled over into an IRA for a beneficiary who is not the decedent's spouse.
The adjusted gross income limits for IRA and Roth IRA contributions are adjusted for inflation after 2006.
(You Answered) (Correct Answer) All of the above are correct.
Question 6
Correct
If a taxpayer wishes strictly to create an account as a bequest, the most effective choice of plans is:
A 401(k) plan
A 403(b) account
(You Answered) (Correct Answer) A Roth IRA
A traditional IRA
Question 7
Correct
An advantage to a Roth IRA is
(You Answered) (Correct Answer) Distributions are not included in computing modified AGI for Social Security inclusion purposes.
Contributions are made on a pre-tax basis.
Roth IRA contributions are taxed at a lower rate than traditional IRA contributions
None of the above
Question 8
Correct
Receiving distributions from a traditional IRA as opposed to a Roth IRA can affect all of the following except:
Deductions based on modified AGI
Tax brackets
State tax rates
(You Answered) (Correct Answer) All of the above may be affected
Question 9
Incorrect
Which of the following is not true?
(Correct Answer) Taxable income on an individual’s federal income tax return will increase modestly when there is a modest increase in a taxpayer’s income.
Taxable income on an individual’s federal income tax return can increase considerably because of only a modest increase in the taxpayer’s income level.
An individual’s state income tax may be impacted because of only a modest increase in the taxpayer’s federal taxable income.
Some states do not tax distributions from retirement accounts.
Question 10
Correct
Tax-deferred, traditional IRAs are generally more advantageous than Roth IRAs if taxpayers will be in _____ tax bracket during retirement.
A higher
(You Answered) (Correct Answer) A lower
The same
Roth IRAs are always more advantageous than traditional IRAs.