HR BLOCK (TKA EXAM PREP) EXAM
QUESTIONS AND ANSWERS GRADED A+
2025/2026
IRC - ANS Internal Revenue Code
Standard Deduction - ANS Set by statute. Included in calculating the Below-the-Line
deductions (for Taxable Income). Alternative is Itemized Deduction
Itemized Deduction - ANS Sum of allowable deductions in calculating the Below-the-Line
deductions (for Taxable Income). Alternative is Standard Deduction
Tax Rate (Individuals) - Ordinary Income - ANS 10% - 37%
Tax Rate (Individuals) - Net Gains / Qualified Dividends - ANS 0% - 20% (sometimes) 20% -
28% (usually)
Alternative Minimum Tax Rate - ANS 26% - 28%
Capital Gains - ANS Profit (or Loss) from the sale of property or investments (preferential tax
rate compared to Ordinary Income)
1 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
, Adjusted Gross Income (AGI) - ANS Gross Income - Deductions
Taxable Income - ANS AGI - (Larger of Standard or Itemized Deduction)
Tentative Tax - ANS Taxable Income (x) Tax Rate
Taxes Due (+) or Refund (-) - ANS Tentative Tax - Credits
Refundable Tax Credit - ANS Taxpayer can receive money through a refund
Nonrefundable Tax Credit - ANS Tax is lowered to a possible $0. But no refund.
Title 26 (US. Code) - ANS The statutory bas of all federal tax law.
Gross Income - ANS "All income from whatever source derived"
Haig-Simons Definition of Income - ANS Market Value of Rights Exercised in Consumption +
Change in Property Rights over the Term.
Interpretation: Total value of consumer expenditures + net change in savings (e.g., bank
accounts, stocks and bonds, real estate)
Alternative is Economic Benefit Definition.
2 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
QUESTIONS AND ANSWERS GRADED A+
2025/2026
IRC - ANS Internal Revenue Code
Standard Deduction - ANS Set by statute. Included in calculating the Below-the-Line
deductions (for Taxable Income). Alternative is Itemized Deduction
Itemized Deduction - ANS Sum of allowable deductions in calculating the Below-the-Line
deductions (for Taxable Income). Alternative is Standard Deduction
Tax Rate (Individuals) - Ordinary Income - ANS 10% - 37%
Tax Rate (Individuals) - Net Gains / Qualified Dividends - ANS 0% - 20% (sometimes) 20% -
28% (usually)
Alternative Minimum Tax Rate - ANS 26% - 28%
Capital Gains - ANS Profit (or Loss) from the sale of property or investments (preferential tax
rate compared to Ordinary Income)
1 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
, Adjusted Gross Income (AGI) - ANS Gross Income - Deductions
Taxable Income - ANS AGI - (Larger of Standard or Itemized Deduction)
Tentative Tax - ANS Taxable Income (x) Tax Rate
Taxes Due (+) or Refund (-) - ANS Tentative Tax - Credits
Refundable Tax Credit - ANS Taxpayer can receive money through a refund
Nonrefundable Tax Credit - ANS Tax is lowered to a possible $0. But no refund.
Title 26 (US. Code) - ANS The statutory bas of all federal tax law.
Gross Income - ANS "All income from whatever source derived"
Haig-Simons Definition of Income - ANS Market Value of Rights Exercised in Consumption +
Change in Property Rights over the Term.
Interpretation: Total value of consumer expenditures + net change in savings (e.g., bank
accounts, stocks and bonds, real estate)
Alternative is Economic Benefit Definition.
2 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
