4018523
Description
Quiz by Stephany Fox, updated more than 1 year ago
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Created by Stephany Fox
over 8 years ago
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Question 1
Question
Reorganization is a non taxable exchange
Answer
- True
- False
Question 2
Question
Which of the following is false regarding annuities?
Answer
-
They are misleading, as they do not adjust for inflation
-
Premiums that you pay will equal your basis, so this part is recovered tax-free
-
Annuities are more beneficial for the buyers than for the insurance company
Question 3
Question
If you pay $400k in annuity premiums, but you'll live long enough to use 720k worth, how much of each dollar of annuity payment must you pay tax on?
Answer
-
400/720
-
720/400
Question 4
Question
Which of the following is not a characteristic of US EE savings bonds?
Answer
-
You pay for half
-
They accrue interest, on which you continually pay tax
-
All accrued interest is taxable at once
-
They stop paying interest after 30 years
Question 5
Question
Only net profit (rents minus operating and maintenance expenses) are included in the AGI of an owner of rental real estate.
Answer
- True
- False
Question 6
Question
Which of the following is true about rental real estate?
Answer
-
Rental real estate is a 1231 asset
-
Buildings are depreciated using MACRS with either 27.5 or 39 year recover periods
-
Depreciation allows owners to recover their investments in buildings
-
Rental real estate is never subject to Medicare contribution tax
Question 7
Question
A passive activity occurs when someone owns interest in a business and materially participates in the business, but they are not concerned about whether they make a profit.
Answer
- True
- False
Question 8
Question
Which of the following people would definitely be able to take a deduction of $5k for their passive activity loss?
Answer
-
Sandra had a regular business loss of $10k in the same year.
-
Billy had a regular business loss of $4k in that same year and no passive activity income
-
Lola had $5k of passive activity income
Question 9
Question
Hotels do not count as passive activity rental properties.
Answer
- True
- False
Question 10
Question
Whom of the following would be eligible for the special $25k passive activity loss deduction?
Answer
-
Nancy, who makes $150k/year
-
Zach, who makes $600k/year
Question 11
Question
Which of the following is an acceptable way to "cut one's losses" from a passive activity?
Answer
-
Get out the business and sell
-
Get involved in another passive activity, make a profit,and deduct the passive loss from your previous activity
Question 12
Question
Jill is single and has a net investment income of $125k and an AGI of $300k. How much will her income Medicare contribution tax be?
Answer
-
$4,651, or 3.8% of her net investment income
-
$11,400, or 3.8% of her AGI.
-
$3,800, or 3.8% of the excess of her AGI over the threshold of $200k
Question 13
Question
There are four basic kinds of transfer taxes.
Answer
- True
- False
Question 14
Question
A person has to be alive to transfer something subject to gift tax.
Answer
- True
- False
Question 15
Question
Which of the following gifts are not taxable?
Answer
-
Denny gives his convertible to his wife, friend Morton.
-
Felicia pays for her niece's chemotherapy treatments.
-
Wally gives loses his prize race horse in a bet.
Question 16
Question
Which of the following are eligible for a tax exclusion (given that none of the following people are related or married?
Answer
-
Tim gives Theresa a diamond ring worth $6k
-
Kimberly gives Kate a set of pots worth $300
-
Dana gives Lorraine a cooking lesson and pays for $30 of groceries
-
Lorraine gives Kyle plane tickets worth $20k so he can travel the world
Question 17
Question
You don't actually pay the tax on gift items until the lifetime transfer tax exclusion is reached. This is $5M, indexed each year for inflation. After this threshold is reached, the tax rate is 40%
Answer
- True
- False
Question 18
Question
Which of the following estates won't have to pay tax?
Answer
-
Betty leaves all her money to her son Tim
-
Ramona leaves all her money to her husband Levi
-
Janelle leaves all her money to Boys and Girls Club
-
Tom leaves all his money to his mistress Crystal
Question 19
Question
If Karla inherits a house worth $1M from her mother Bella, she will have to include it in her income for that year.
Answer
- True
- False
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