A+ Answers
A+ Answers
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Question 1 Which of the following is true about the rental of real estate? Question 1 options:
Depreciation and maintenance expenses for an apartment complex are deductible.
A vacation home is a home that is rented for 15 days or more and is used by the taxpayer for personal use for more than the greater of 14 days or 10 percent of the days it is rented for fair value during the year. If a home is rented for less than 15 days a year, the rental income is not taxable.
Repairs on
rental property are deductible by the taxpayer
All of the above.
Question 2 John owns a second home in Palm Springs, CA. During the year, he rented the house for $4,000 for 30 days and used the house for 10 days during the
summer. The house remained vacant during the remainder of the year. The expenses for the home included $5,000 in mortgage interest, $600 in property taxes, $900 for utilities and maintenance, and $3,500 of depreciation. What is John’s deductible rental loss,
before considering the passive loss limitations? Question 2 options: $200 $875 $1,600 $3,500 $0 Question 3 Question 3 Helen, a single taxpayer, has modified adjusted gross income (before passive losses) of $90,000. During 2014, Helen’s
rental house generated a loss of $15,000. Assuming Helen is actively involved in the management of the property, what is the amount of Helen’s permitted loss deduction from the rental house? Question 3 options: $0 $5,000 $10,000 $15,000 None of the above Save
Which of the following types of income is passive income?
Question 4 options:
Income from limited partnership investments
Self employment income
Wages
Interest and dividend income
Norm is a real estate professional with a real estate trade or business as defined in the tax law. He has $80,000 of business income and $40,000 of losses from actively managed real estate rentals. How much of the $40,000 in losses is he allowed to claim on his tax return?
Question 5 options:
$40,000
None
$20,000
$25,000
Question 6
Which of the following is false about the self-employed health insurance deduction?
Question 6 options:
The self-employed health insurance deduction is an itemized deduction.
Long-term care premiums may be deducted within specified dollar limitations based on age.
The deduction cannot be claimed when a subsidized employer health insurance plan is also available.
The deduction cannot be claimed if the taxpayer has an overall business loss from self-employment.
Question 7
Lyndon, age 24, has a nonworking spouse and earns wages of $36,000 for 2014. He also received rental income of $5,000 and dividend income of $900 for the year. What is the maximum total amount Lyndon can deduct for contributions to his and his wife’s individual retirement accounts for the 2014 tax year?
Question 7 options:
$4,500
$5,500
$11,000
$3,600
Question 8
Mary has a Roth IRA held more than 5 years to which she has contributed $30,000. The IRA has a current value of $62,000. Mary is 55 years old and she takes a distribution of $38,000. How much of the distribution will be taxable to Mary?
Question 8 options:
$38,000
$30,000
0
$8,000
Question 9
Bob earns $40,000 during the current year. His employer contributes $2,000 (5 percent of Bob’s salary) to a qualified retirement plan for Bob. This pension plan is what kind of plan?
Question 9 options:
Defined benefit plan
Profit-sharing plan
Defined contribution plan
Employee Stock Ownership Plan
Question 10
James’ employer makes a $2,000 contribution to a qualified retirement plan for James in the current year. James is only 45 years old and does not expect to retire until age 65, 20 years from now. What is the proper tax treatment of the $2,000 contribution for James’ employer?
Question 10 options:
The $2,000 is deductible in the year James retires by the employer.
The $2,000 is deductible in the current year by the employer.
Only one-twentieth ($100) is deductible in the current year by the employer.
The $2,000 is never deductible.
