DOWNLOAD THE Test Bank for Pearsons Federal Taxation 2022 Comprehensive 35th E
n n n n n n n n n n n
dition Rupert n
Pearson'snFederalnTaxationn2022:nIndividuals,n35en(Rupert)n
ChapternI1: AnnIntroductionntonTaxation
LO1:n n HistorynofnTaxationninnthenUnitednStates
1) Thenfederalnincomentaxnisnthendominantnformnofntaxationnbynthenfederalngovernment.n
Answer:n TRUE
Explanation:n Thenfederalnincomentaxnprovidesnmorenrevenuesnthannanynotherntax.nP
agenRef.:n I:1-2
Objective:n n 1
2) ThenSixteenthnAmendmentntonthenU.S.nConstitutionnpermitsnthenpassagenofnanfederalnincoment
axnlaw.
Answer:n n TRUE
Explanation:n ThenSixteenthnAmendmentnamendednthenConstitutionntonpermitnthenimpositionnofna
nnincomentax.
PagenRef.:n I:1-
2nObjective:n 1
3) WhennanchangeninnthentaxnlawnisndeemednnecessarynbynCongress,nthenentirenInternalnRevenuen
Codenmustnbenrevised.
Answer:n n FALSE
Explanation:n Thenfederalnincomentaxnlawnisnchangednonnannincrementalnbasis.nPage
nRef.:n I:1-3
Objective:n n 1
4) Thenlargestnsourcenofnfederalnrevenuesnisnthencorporatenincomentax.n
Answer:n FALSE
Explanation:n Thenlargestnsourcenisnthenindividualnincomentax.n
PagenRef.:n I:1-3
Objective:n n 1
5) Untilnaboutn100nyearsnago,nattemptsntonimposenanfederalnincomentaxnwerenrulednunconstitutio
nal.nThenamendmentntonthenU.S.nConstitutionnallowingnthenimpositionnofnanfederalnincomentaxnisn
the
A) SecondnAmendment.
B) ThirteenthnAmendment.
C) SixteenthnAmendment.
D) NineteenthnAmendment.
nAnswer:n C
Explanation:n ThenSixteenthnAmendment,nratifiedninn1913,ngavenCongressnthenpowerntonimposenanfe
deralnincomentax.
PagenRef.:n I:1-
2nObjective:n 1
1
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,DOWNLOAD THE Test Bank for Pearsons Federal Taxation 2022 Comprehensive 35th E
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6) Thenlargestnsourcenofnrevenuesnfornthenfederalngovernmentncomesnfrom
A) individualnincomentaxes.
B) corporatenincomentaxes.
C) SocialnSecuritynandnMedicarentaxesn(FICA).
D) estatenandngiftntaxes.
Answer:n n A
Explanation:n Thenindividualnincomentaxnhasnprovidednthenlargestnsourcenofnrevenuesnfornmanynyear
s.
PagenRef.:n I:1-
3nObjective:n 1
LO2:n n TypesnofnTaxnRatenStructures
1) Anprogressiventaxnratenstructurenisnonenwherenthenratenofntaxnincreasesnasnthentaxnbasenincreases.n
Answer:n TRUE
Explanation:n Undernanprogressiventaxnsystem,nthenratenincreasesnasnthentaxnbasenincreases.nP
agenRef.:n I:1-4
Objective:n n 2
2) Thentermsn"progressiventax"nandn"flatntax"narensynonymous.n
Answer:n FALSE
Explanation:n Anproportional,nnotnprogressive,ntaxnandnflatntaxnarensynonymous.nPa
genRef.:n I:1-4
Objective:n n 2
3) Anproportionalntaxnratenisnonenwherenthenratenofnthentaxnisnthensamenfornallntaxpayers,nregardlessno
fnincomenlevels.
Answer:n n TRUE
Explanation:n Anproportionalntaxnisnessentiallynanflatntax.n
PagenRef.:n I:1-4
Objective:n n 2
4) Regressiventaxnratesndecreasenasnthentaxnbasenincreases.n
Answer:n TRUE
Explanation:n Regressivenratesnincreasenasnthenbasendecreases.n
PagenRef.:n I:1-5
Objective:n n 2
5) Thenmarginalntaxnratenisnusefulninntaxnplanningnbecausenitnmeasuresnthentaxneffectnofnanproposedntr
ansaction.
Answer:n n TRUE
Explanation:n Thenmarginalnratenappliesntonthenplannednadditionntonincomenornreductionntonincome.
PagenRef.:n I:1-
5nObjective:n 2
2
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,DOWNLOAD THE Test Bank for Pearsons Federal Taxation 2022 Comprehensive 35th E
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6) Antaxpayer'snaveragentaxnratenisnthentaxnratenappliedntonannincrementalnamountnofntaxableni
ncomenthatnisnaddedntonthentaxnbase.
Answer:n n FALSE
Explanation:n Thenmarginalntaxnratenisnthentaxnratenappliedntonannincrementalnamountnofntaxableninco
me.
PagenRef.:n I:1-
5nObjective:n 2
7) Ifnantaxpayer'sntotalntaxnliabilitynisn$30,000,ntaxablenincomenisn$100,000,nandneconomicnincomeni
sn$120,000,nthenaveragentaxnratenisn30npercent.
Answer:n n TRUE
Explanation:n Thenaveragenratenequalsnthentaxnliabilityndividednbynthentaxablenincome.nP
agenRef.:n I:1-5
Objective:n n 2
8) Ifnantaxpayer'sntotalntaxnliabilitynisn$4,000,ntaxablenincomenisn$20,000,nandntotalneconomicni
ncomenisn$40,000,nthenntheneffectiventaxnratenisn20npercent.
Answer:n n FALSE
Explanation:n Theneffectivenratenwouldnben$4,000/$40,000n=n10npercent.nPa
genRef.:n I:1-6
Objective:n n 2
9) Arthurnpaysntaxnofn$5,000nonntaxablenincomenofn$50,000nwhilentaxpayernBarbaranpaysntaxnof
$12,000nonn$120,000.nThentaxnisna
A) progressiventax.
B) proportionalntax.
C) regressiventax.
D) Nonenofnthenabove.
Answer:n n B
Explanation:n Thentaxnratenisnproportionalnbecausenthen10%ntaxnratenappliesntonbothntaxpayersnregard
lessnofntheirnincomenlevel.
PagenRef.:n I:1-4;nExamplenI:1-
3nObjective:n 2
10) Whichnofnthenfollowingntaxesnisnprogressive?
A) salesntax
B) excisentax
C) propertyntax
D) federalnincomentaxn
Answer:n D
Explanation:n Federalnincomentaxnratesnincreasenasnantaxpayer'sntaxablenincomenrises.nPa
genRef.:n I:1-4;nTopicnReviewnI:1-1
Objective:n n 2
3
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, DOWNLOAD THE Test Bank for Pearsons Federal Taxation 2022 Comprehensive 35th E
n n n n n n n n n n n
dition Rupert n
11) Whichnofnthenfollowingntaxesnisnproportional?
A) giftntax
B) incomentax
C) salesntax
D) FederalnInsurancenContributionsnActn(FICA)n
Answer:n C
Explanation:n Ansalesntaxnisnassessednatnanfixednratenofnthenpurchasenamount,nbasednonnstatenandnloc
alnlaw.
PagenRef.:n I:1-4;nTopicnReviewnI:1-
1nObjective:n 2
12) Whichnofnthenfollowingntaxesnisnregressive?
A) FederalnInsurancenContributionsnActn(FICA)
B) excisentax
C) propertyntax
D) giftntaxn
Answer:n n A
Explanation:n Fornuppernincomenwagenearners,nthenSocialnSecurityntaxnceasesnatnanmaximumnwagen
base.nForn2021,nwagesnovern$142,800narennotnsubjectntonthenSocialnSecurityntax.
PagenRef.:n I:1-5;nTopicnReviewnI:1-
1nObjective:n 2
13) Thencorporatentaxnratenis
A) progressive.
B) regressive.
C) proportional.
D) nonenofnthenabove.
Answer:n n C
Explanation:n Thencorporatentaxnratenisnanflatn21npercent.n
PagenRef.:n I:1-5
Objective:n n 2
14) Sarahncontributesn$25,000ntonanchurch.nSarah'snmarginalntaxnratenisn35%nwhilenhernaveragentaxnr
atenisn25%.nAfternconsideringnherntaxnsavings,nSarah'sncontributionncosts
A) $6,250.
B) $8,750.
C) $16,250.
D) $18,750.
Answer:n n C
Explanation:n [$25,000n×n(100%n-
n35%)]n=n$16,250nPagenRef.:n I:1-5;nExamplenI:1-4
Objective:n n 2
4
Copyrightn©n2022nPearsonnEducation,nInc.
mynursytest.store
n n n n n n n n n n n
dition Rupert n
Pearson'snFederalnTaxationn2022:nIndividuals,n35en(Rupert)n
ChapternI1: AnnIntroductionntonTaxation
LO1:n n HistorynofnTaxationninnthenUnitednStates
1) Thenfederalnincomentaxnisnthendominantnformnofntaxationnbynthenfederalngovernment.n
Answer:n TRUE
Explanation:n Thenfederalnincomentaxnprovidesnmorenrevenuesnthannanynotherntax.nP
agenRef.:n I:1-2
Objective:n n 1
2) ThenSixteenthnAmendmentntonthenU.S.nConstitutionnpermitsnthenpassagenofnanfederalnincoment
axnlaw.
Answer:n n TRUE
Explanation:n ThenSixteenthnAmendmentnamendednthenConstitutionntonpermitnthenimpositionnofna
nnincomentax.
PagenRef.:n I:1-
2nObjective:n 1
3) WhennanchangeninnthentaxnlawnisndeemednnecessarynbynCongress,nthenentirenInternalnRevenuen
Codenmustnbenrevised.
Answer:n n FALSE
Explanation:n Thenfederalnincomentaxnlawnisnchangednonnannincrementalnbasis.nPage
nRef.:n I:1-3
Objective:n n 1
4) Thenlargestnsourcenofnfederalnrevenuesnisnthencorporatenincomentax.n
Answer:n FALSE
Explanation:n Thenlargestnsourcenisnthenindividualnincomentax.n
PagenRef.:n I:1-3
Objective:n n 1
5) Untilnaboutn100nyearsnago,nattemptsntonimposenanfederalnincomentaxnwerenrulednunconstitutio
nal.nThenamendmentntonthenU.S.nConstitutionnallowingnthenimpositionnofnanfederalnincomentaxnisn
the
A) SecondnAmendment.
B) ThirteenthnAmendment.
C) SixteenthnAmendment.
D) NineteenthnAmendment.
nAnswer:n C
Explanation:n ThenSixteenthnAmendment,nratifiedninn1913,ngavenCongressnthenpowerntonimposenanfe
deralnincomentax.
PagenRef.:n I:1-
2nObjective:n 1
1
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,DOWNLOAD THE Test Bank for Pearsons Federal Taxation 2022 Comprehensive 35th E
n n n n n n n n n n n
dition Rupert n
6) Thenlargestnsourcenofnrevenuesnfornthenfederalngovernmentncomesnfrom
A) individualnincomentaxes.
B) corporatenincomentaxes.
C) SocialnSecuritynandnMedicarentaxesn(FICA).
D) estatenandngiftntaxes.
Answer:n n A
Explanation:n Thenindividualnincomentaxnhasnprovidednthenlargestnsourcenofnrevenuesnfornmanynyear
s.
PagenRef.:n I:1-
3nObjective:n 1
LO2:n n TypesnofnTaxnRatenStructures
1) Anprogressiventaxnratenstructurenisnonenwherenthenratenofntaxnincreasesnasnthentaxnbasenincreases.n
Answer:n TRUE
Explanation:n Undernanprogressiventaxnsystem,nthenratenincreasesnasnthentaxnbasenincreases.nP
agenRef.:n I:1-4
Objective:n n 2
2) Thentermsn"progressiventax"nandn"flatntax"narensynonymous.n
Answer:n FALSE
Explanation:n Anproportional,nnotnprogressive,ntaxnandnflatntaxnarensynonymous.nPa
genRef.:n I:1-4
Objective:n n 2
3) Anproportionalntaxnratenisnonenwherenthenratenofnthentaxnisnthensamenfornallntaxpayers,nregardlessno
fnincomenlevels.
Answer:n n TRUE
Explanation:n Anproportionalntaxnisnessentiallynanflatntax.n
PagenRef.:n I:1-4
Objective:n n 2
4) Regressiventaxnratesndecreasenasnthentaxnbasenincreases.n
Answer:n TRUE
Explanation:n Regressivenratesnincreasenasnthenbasendecreases.n
PagenRef.:n I:1-5
Objective:n n 2
5) Thenmarginalntaxnratenisnusefulninntaxnplanningnbecausenitnmeasuresnthentaxneffectnofnanproposedntr
ansaction.
Answer:n n TRUE
Explanation:n Thenmarginalnratenappliesntonthenplannednadditionntonincomenornreductionntonincome.
PagenRef.:n I:1-
5nObjective:n 2
2
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,DOWNLOAD THE Test Bank for Pearsons Federal Taxation 2022 Comprehensive 35th E
n n n n n n n n n n n
dition Rupert n
6) Antaxpayer'snaveragentaxnratenisnthentaxnratenappliedntonannincrementalnamountnofntaxableni
ncomenthatnisnaddedntonthentaxnbase.
Answer:n n FALSE
Explanation:n Thenmarginalntaxnratenisnthentaxnratenappliedntonannincrementalnamountnofntaxableninco
me.
PagenRef.:n I:1-
5nObjective:n 2
7) Ifnantaxpayer'sntotalntaxnliabilitynisn$30,000,ntaxablenincomenisn$100,000,nandneconomicnincomeni
sn$120,000,nthenaveragentaxnratenisn30npercent.
Answer:n n TRUE
Explanation:n Thenaveragenratenequalsnthentaxnliabilityndividednbynthentaxablenincome.nP
agenRef.:n I:1-5
Objective:n n 2
8) Ifnantaxpayer'sntotalntaxnliabilitynisn$4,000,ntaxablenincomenisn$20,000,nandntotalneconomicni
ncomenisn$40,000,nthenntheneffectiventaxnratenisn20npercent.
Answer:n n FALSE
Explanation:n Theneffectivenratenwouldnben$4,000/$40,000n=n10npercent.nPa
genRef.:n I:1-6
Objective:n n 2
9) Arthurnpaysntaxnofn$5,000nonntaxablenincomenofn$50,000nwhilentaxpayernBarbaranpaysntaxnof
$12,000nonn$120,000.nThentaxnisna
A) progressiventax.
B) proportionalntax.
C) regressiventax.
D) Nonenofnthenabove.
Answer:n n B
Explanation:n Thentaxnratenisnproportionalnbecausenthen10%ntaxnratenappliesntonbothntaxpayersnregard
lessnofntheirnincomenlevel.
PagenRef.:n I:1-4;nExamplenI:1-
3nObjective:n 2
10) Whichnofnthenfollowingntaxesnisnprogressive?
A) salesntax
B) excisentax
C) propertyntax
D) federalnincomentaxn
Answer:n D
Explanation:n Federalnincomentaxnratesnincreasenasnantaxpayer'sntaxablenincomenrises.nPa
genRef.:n I:1-4;nTopicnReviewnI:1-1
Objective:n n 2
3
Copyrightn©n2022nPearsonnEducation,nInc.
mynursytest.store
, DOWNLOAD THE Test Bank for Pearsons Federal Taxation 2022 Comprehensive 35th E
n n n n n n n n n n n
dition Rupert n
11) Whichnofnthenfollowingntaxesnisnproportional?
A) giftntax
B) incomentax
C) salesntax
D) FederalnInsurancenContributionsnActn(FICA)n
Answer:n C
Explanation:n Ansalesntaxnisnassessednatnanfixednratenofnthenpurchasenamount,nbasednonnstatenandnloc
alnlaw.
PagenRef.:n I:1-4;nTopicnReviewnI:1-
1nObjective:n 2
12) Whichnofnthenfollowingntaxesnisnregressive?
A) FederalnInsurancenContributionsnActn(FICA)
B) excisentax
C) propertyntax
D) giftntaxn
Answer:n n A
Explanation:n Fornuppernincomenwagenearners,nthenSocialnSecurityntaxnceasesnatnanmaximumnwagen
base.nForn2021,nwagesnovern$142,800narennotnsubjectntonthenSocialnSecurityntax.
PagenRef.:n I:1-5;nTopicnReviewnI:1-
1nObjective:n 2
13) Thencorporatentaxnratenis
A) progressive.
B) regressive.
C) proportional.
D) nonenofnthenabove.
Answer:n n C
Explanation:n Thencorporatentaxnratenisnanflatn21npercent.n
PagenRef.:n I:1-5
Objective:n n 2
14) Sarahncontributesn$25,000ntonanchurch.nSarah'snmarginalntaxnratenisn35%nwhilenhernaveragentaxnr
atenisn25%.nAfternconsideringnherntaxnsavings,nSarah'sncontributionncosts
A) $6,250.
B) $8,750.
C) $16,250.
D) $18,750.
Answer:n n C
Explanation:n [$25,000n×n(100%n-
n35%)]n=n$16,250nPagenRef.:n I:1-5;nExamplenI:1-4
Objective:n n 2
4
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