Taxation of Individuals final exam with || || || || || ||
answers
Sole Proprietorship - CORRECT ANSWERS ✔✔Revenues and expenses are
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reported directly on the owner's tax return and the profit (or loss) is subject to
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both individual income and self employment taxes.
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partnership - CORRECT ANSWERS ✔✔Entity files a tax return but the profit
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or loss flows through to owners' individual income tax returns.
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C corporation - CORRECT ANSWERS ✔✔Income is taxed at the entity level
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rather than flowing through to the owner(s).
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Which of the following costs are NOT included in the tax basis of personal
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property? - CORRECT ANSWERS ✔✔first year's insurance premium
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The maximum deduction for Sec 179 expensing for 2021 is - CORRECT
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ANSWERS ✔✔$1,050,000 ||
A company can claim section 179 depreciation for a 3-year asset costing
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$22,000 for its 1st year, and then uses MACRS depreciation for year 2 and 3 -
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CORRECT ANSWERS ✔✔false || ||
, under current tax law, bonus depreciation includes qualified property
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purchased through Jan 2023. Which of the following statements are true
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concerning bonus depreciation - CORRECT ANSWERS ✔✔bonus
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depreciation is at 100% of the purchase cost, and can be deducted with no
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limit after Sec 179 is taken
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depreciation expense is a deduction from AGI - CORRECT ANSWERS
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✔✔false
company Y purchased a computer for for $2,000 utilizing MACRS and the
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Half-Year convention. The amount of depreciation for year 1 is ? - CORRECT
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ANSWERS ✔✔$400 ||
Which of the following is classified as 7-year property under MACRS? -
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CORRECT ANSWERS ✔✔Robotics machinery || || ||
If you don't elect out of Sec 179, it will be the default used to calculate the
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current years depreciation. - CORRECT ANSWERS ✔✔False
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For amortization of SEC 197 intangibles, the default method for tax is -
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CORRECT ANSWERS ✔✔SL for 15 Years || || || || ||
Which of the following is NOT an example of portfolio income? - CORRECT
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ANSWERS ✔✔rents on real estate || || || ||
answers
Sole Proprietorship - CORRECT ANSWERS ✔✔Revenues and expenses are
|| || || || || || || || ||
reported directly on the owner's tax return and the profit (or loss) is subject to
|| || || || || || || || || || || || || ||
both individual income and self employment taxes.
|| || || || || || ||
partnership - CORRECT ANSWERS ✔✔Entity files a tax return but the profit
|| || || || || || || || || || || ||
or loss flows through to owners' individual income tax returns.
|| || || || || || || || ||
C corporation - CORRECT ANSWERS ✔✔Income is taxed at the entity level
|| || || || || || || || || || || ||
rather than flowing through to the owner(s).
|| || || || || ||
Which of the following costs are NOT included in the tax basis of personal
|| || || || || || || || || || || || || ||
property? - CORRECT ANSWERS ✔✔first year's insurance premium
|| || || || || || ||
The maximum deduction for Sec 179 expensing for 2021 is - CORRECT
|| || || || || || || || || || || ||
ANSWERS ✔✔$1,050,000 ||
A company can claim section 179 depreciation for a 3-year asset costing
|| || || || || || || || || || || ||
$22,000 for its 1st year, and then uses MACRS depreciation for year 2 and 3 -
|| || || || || || || || || || || || || || || ||
CORRECT ANSWERS ✔✔false || ||
, under current tax law, bonus depreciation includes qualified property
|| || || || || || || || ||
purchased through Jan 2023. Which of the following statements are true
|| || || || || || || || || || ||
concerning bonus depreciation - CORRECT ANSWERS ✔✔bonus
|| || || || || || ||
depreciation is at 100% of the purchase cost, and can be deducted with no
|| || || || || || || || || || || || || ||
limit after Sec 179 is taken
|| || || || ||
depreciation expense is a deduction from AGI - CORRECT ANSWERS
|| || || || || || || || || ||
✔✔false
company Y purchased a computer for for $2,000 utilizing MACRS and the
|| || || || || || || || || || || ||
Half-Year convention. The amount of depreciation for year 1 is ? - CORRECT
|| || || || || || || || || || || || ||
ANSWERS ✔✔$400 ||
Which of the following is classified as 7-year property under MACRS? -
|| || || || || || || || || || || ||
CORRECT ANSWERS ✔✔Robotics machinery || || ||
If you don't elect out of Sec 179, it will be the default used to calculate the
|| || || || || || || || || || || || || || || || ||
current years depreciation. - CORRECT ANSWERS ✔✔False
|| || || || || ||
For amortization of SEC 197 intangibles, the default method for tax is -
|| || || || || || || || || || || || ||
CORRECT ANSWERS ✔✔SL for 15 Years || || || || ||
Which of the following is NOT an example of portfolio income? - CORRECT
|| || || || || || || || || || || || ||
ANSWERS ✔✔rents on real estate || || || ||
