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| 1 | |
For 2007, the amount of deductible student loan interest is $2,500. |
| | A) | True |
| | B) | False |
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| 2 | |
Qualifying moving expenses are treated as an itemized deduction for 2007. |
| | A) | True |
| | B) | False |
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| 3 | |
The deduction for self-employment taxes is deductible as an above-the-line deduction at a rate of 50% of the total amount of the taxes. |
| | A) | True |
| | B) | False |
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| 4 | |
The cost of self-employed health insurance premiums are deductible above-the line at a rate of 80% of the cost. |
| | A) | True |
| | B) | False |
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| 5 | |
If a divorce agreement executed in 2007 specifies that a portion of the amount of an alimony payment is contingent upon the status of a child, that portion is considered to be a child support payment. |
| | A) | True |
| | B) | False |
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| 6 | |
The amount of the deduction for student loan interest for an eligible taxpayer is limited in the 2007 tax year to: |
| | A) | $1,500 |
| | B) | $2,000 |
| | C) | $2,350 |
| | D) | $2,500 |
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| 7 | |
A qualified education loan is one incurred by the taxpayer solely to pay qualified education expenses incurred on behalf of the: |
| | A) | taxpayer |
| | B) | taxpayer's spouse |
| | C) | a dependent of the taxpayer |
| | D) | all of the above |
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| 8 | |
In order to qualify for a Health Savings Plan (HSA), a taxpayer must be: |
| | A) | Over age 35 |
| | B) | An employee (or spouse) who works for an employer with a deductible health plan. |
| | C) | A self-employed individual |
| | D) | Both b and c |
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| 9 | |
For family coverage in 2007, the maximum deductible to a Health Savings Account is: |
| | A) | $3,500 |
| | B) | $5,500 |
| | C) | $11,000 |
| | D) | None of the above |
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| 10 | |
Which of the following is deductible as a moving expense? |
| | A) | The cost of moving household goods |
| | B) | Meal cost incurred during the move. |
| | C) | The cost of a pre-move house hunting trip |
| | D) | All of the above are deductible as moving expenses |
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| 11 | |
In order to meet the distance test criteria for qualifying moving expenses, the new job location must be: |
| | A) | 100 miles from the old residence |
| | B) | 100 miles from the old job location |
| | C) | at least 50 miles farther than the old residence was from the old job location |
| | D) | at least 50 miles farther than the new residence from the old job location |
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| 12 | |
In order to meet the time test for qualifying moving expenses, a taxpayer must: |
| | A) | Be a full-time employee for a period of 39 weeks during the 12 months immediately following arrival in the new area. |
| | B) | Be a full-time employee (or must work as a self-employed individual on a full time basis) for at least 78 weeks during the 24 months immediately following arrival in the new area. |
| | C) | Remain employed only in the new job for the entire 39 or 78 week period. |
| | D) | a and b |
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| 13 | |
Which of the following types of income is subject to the self-employment tax? |
| | A) | Income from a sole proprietor's coffee shop. |
| | B) | Gain on the sale of a home. |
| | C) | W-2 income |
| | D) | Interest earned on a bank account. |
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| 14 | |
The self-employment tax is calculated on: |
| | A) | Form 1040 |
| | B) | Schedule C |
| | C) | Form SE |
| | D) | Schedule D |
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| 15 | |
The amount of self-employed health insurance premiums that are deductible as a "for AGI" deduction is: |
| | A) | 100% |
| | B) | 80% |
| | C) | 70% |
| | D) | 50% |
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| 16 | |
Sade, who is single and self-employed as a graphic artist, had net earnings from self-employment of $7,250 for the year. She paid $285 a month for health insurance premiums over the last year. Sade is entitled to a for AGI deduction for health insurance of: |
| | A) | $0 |
| | B) | $285 |
| | C) | $3,420 |
| | D) | $3,830 |
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| 17 | |
If you withdraw your deposit on a CD before the instrument matures, the penalty for the early withdrawal on interest will be reported by the financial institution on: |
| | A) | Form EWIP |
| | B) | Box 2 of Form 1099-INT |
| | C) | a letter of notification |
| | D) | none of the above |
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| 18 | |
Which of the following is not a deductible alimony payment? |
| | A) | Payments for child support required by the divorce decree. |
| | B) | Payments for life insurance premiums required by the divorce decree. |
| | C) | Half of the mortgage payment on a home jointly owned with the ex-spouse when required by the decree of divorce. |
| | D) | Payments for dental expenses of the ex-spouse under terms of the divorce agreement. |
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| 19 | |
Rebecca is required under a 2007 divorce agreement to pay $800 of alimony and $250 of child support per month for 10 years. Rebecca also makes a voluntary payment of $150 per month. How much of the total monthly payments can Rebecca deduct as alimony in 2007? |
| | A) | $0 |
| | B) | $800 |
| | C) | $950 |
| | D) | $1050 |
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| 20 | |
The Orosco's were granted a decree of divorce in 2007. In accordance with the decree, César Orosco is to pay his wife $22,000 a year until their only child, Ricardo now 11, turns 18, and then the payments will decrease by $11,000 per year. For 2007, how much can César deduct as alimony? |
| | A) | $11,000 |
| | B) | $22,000 |
| | C) | $33,000 |
| | D) | None of the above |
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