Tax Changes Affecting 2013 and Beyond (00424728)

This 3 CPE hour courser reviews key federal tax developments that took place during 2012 that will impact individual and business taxpayers in 2013 and future years. Description Uncertainty in 2012 over which tax laws would govern in 2013 and beyond, because of the expiring Bush-era tax cuts, was the most significant development of the year. Now that ATRA has provided some certainty over tax rates into at least the immediate future, taxpayers need to adjust their tax plans accordingly. 2012 was also a significant year for important tax developments from the Treasury Department, the IRS and the courts. These developments caution taxpayers on what is no longer allowed under the tax laws and to shape what steps can be taken in 2013 and beyond to maximize tax savings. This courser reviews key federal tax developments that took place during 2012 that will impact individual and business taxpayers in 2013 and future years.
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final exam score:
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100%

Question 1
Correct
The $2,500 limit on salary reduction contributions to health FSAs applies to which of the following?

2012 plan year only

2012 and 2013 plan years

(You Answered) (Correct Answer) 2013 plan year but not 2012

None of the above

Question 2
Correct
Until further guidance is issued, which of the following employers is exempt from reporting on an employee's Form W-2 the cost of coverage they provided to that individual under an employer-sponsored group health plan?

(You Answered) (Correct Answer) Employers with fewer than 250 employees

Employers with more than 250

Employers that only provide major medical coverage

No employer is exempt

Question 3
Correct
Effective January 1, 2013, the PPACA imposes which of the following on qualified taxpayers?

A 3.8 percent Additional Medicare Tax and a 0.9 percent NII surtax

(You Answered) (Correct Answer) A 3.8 percent NII surtax and a 0.9 percent Additional Medicare Tax

A 6.2 percent Additional Medicare Tax and a 4.8 percent NII surtax

A 6.2 percent NII surtax and a 4.8 percent Additional Medicare Tax

Question 4
Correct
The NII and Additional Medicare threshold for a married couple filing jointly is which of the following?

$125,000

$200,000

$225,000

(You Answered) (Correct Answer) $250,000

Question 5
Correct
The Pease limitation reduces the total amount of a higher-income taxpayer’s otherwise allowable itemized deductions by _____ percent of the amount by which the taxpayer’s AGI exceeds an applicable threshold, but the itemized deductions are not reduced by more than ___ percent.

(You Answered) (Correct Answer) 3, 80

2, 80

3, 70

2, 70

Question 6
Correct
The personal exemption phase-out threshold for heads of households in 2013 is:

$300,000

(You Answered) (Correct Answer) $275,000

$250,000

$150,000

Question 7
Correct
Under the personal exemption phase-out for married couples filing jointly, the total exemptions that may be claimed is reduced by ____ percent for each ___ or portion thereof by which the taxpayers’ AGI exceeds the applicable threshold.

Two, $1,500

Three, $1,500

(You Answered) (Correct Answer) Two, $2,500

Three, $2,500

Question 8
Correct
Which of the following statements is not true?

For purposes of measuring a partner's insolvency under Code Sec. 108(d)(3), Rev. Rul. 2012-14 requires that each partner treat as a liability an amount of the partnership's discharged excess nonrecourse debt that is based upon the allocation of COD income to the partner.

Rev. Proc. 2012-28 outlines a safe harbor under which the IRS will not challenge a determination by a publicly traded partnership that COD income is qualifying income under Code Sec. 7704(d).

(You Answered) (Correct Answer) Final regs (TD 9583) generally allow a loss from the sale or exchange of stock to be recognized whether or not the seller and buyer are still members of the same controlled group.

Proposed regs (NPRM REG-141268-11) would prevent the shifting of earnings and profits from one corporation to another in certain tax-free reorganizations.

Question 9
Correct
The temporary expansion of the Voluntary Classification Settlement Program allows an additional group of employers until _____to take advantage of VCSP benefits.

(You Answered) (Correct Answer) June 30, 2013

December 31, 2013

June 30, 2014

December 31, 2014

Question 10
Correct
For 2013, the optional business standard mileage rate is ___ cents per mile, the depreciation component of the business standard mileage rate is __ cents per mile, and the medical/ moving mileage rate is ___ cents per mile for 2013.

(You Answered) (Correct Answer) 56.5, 23, 24

56.5, 23, 25

55.5, 22, 24

55.5, 22, 25

Question 11
Correct
Proposed reliance regs (NPRM REG-137589-07) concerning local lodging expenses allow an employee to do which of the following?

Treat local lodging expenses as working condition fringe benefits only

Treat local lodging expenses as accountable plan reimbursements only

Neither a nor b

(You Answered) (Correct Answer) Both a and b

Question 12
Correct
ATRA did which of the following concerning the New Markets Tax Credit (NMTC)?

Did not extend the NMTC

(You Answered) (Correct Answer) Extended the NMTC retroactively to 2012 and through 2013

Extended the NMTC retroactively to 2012 and through 2014

Extended the NMTC retroactively through 2012 only

Question 13
Correct
The final “repair regs” will apply to tax years beginning on or after what date?

January 1, 2012

January 1, 2013

(You Answered) (Correct Answer) January 1, 2014

January 1, 2015

Question 14
Correct
The 2012 enhancements to the Fresh Start initiative did which of the following?

(You Answered) (Correct Answer) Increased the threshold to $50,000 for an agreement without having to provide a financial statement

Increased the maximum term of streamlined installment agreements to 60 months

Increased the threshold to $50,000 for an agreement if a financial statement is provided

Increased the maximum term of streamlined installment agreements to 74 months

Question 15
Correct
Which of the following statements is not true concerning FATCA?

It is being phased in over several years.

In 2012, the Treasury Department released model agreements to implement FATCA.

Currently, only individuals are required to file Form 8938.

(You Answered) (Correct Answer) Form 8938 relieves a taxpayer who would otherwise be required to file an FBAR from filing an FBAR.