Question 1

If a taxpayer does not own a home but rents an apartment, the office in the home deduction is not available.

Accepted Answer

A) True 
 B)False

Question 2

Lily went from her office in Portland to Lisbon on business. While there, she spent part of the time on vacation. How much of the air fare of $5,000 can she deduct based on the following assumptions:
a. Lily was gone five days (i.e., three business and two personal).
b. Lily was gone five weeks (i.e., four business and one personal).
c. Lily was gone five weeks (i.e., three business and two personal).

Accepted Answer

a. $5,000.
b. $5,000.
c. $3,000. (60% × ...

Question 3

Under the right circumstances, a taxpayer's meals and lodging expense can qualify as a deductible education expense.

Accepted Answer

A) True 
 B)False

Question 4

Match the statements that relate to each other. (Note: Choice L may be used more than once.) 
-Actual cost method of determining car expense

Accepted Answer

A)  Cover charge paid to entertain client at a night club.
B)  Deductible even if taxpayer does not take the new job
C)  Company picnic sponsored by employer
D)  Use of Federal per diem allowance to substantiate meals while in travel status
E)  Does not have to be job relatedF) Can include cost of car insurance and automobile club duesG) Distribution from plan is taxableH) Distribution from plan is not taxableI) Expatriate (U.S. person who is employed overseas)  returns home to retireJ) Taxpayer moves to a new residence 55 miles closer to his present jobK) Country club membership feeL) Correct match not providedM) A) and D)
N) G) and I)

Question 5

Ashley and Matthew are husband and wife and both are practicing CPAs. On a joint return, Ashley gets to deduct her professional dues but Matthew does not. Explain.

Accepted Answer

Most likely Ashley is self­employed, whi...

Question 6

There is no cutback adjustment for meals and entertainment as to employees who are subject to regulation by the U.S. Department of Transportation.

Accepted Answer

A) True 
 B)False  False

Question 7

Janet, who lives and works in Newark, travels to Atlanta for a Thursday-Friday business conference. She stays over after the conference and visits relatives and friends on Saturday. Under certain circumstances, the meals and lodging expenses for Saturday can be considered as business related.

Accepted Answer

A) True 
 B)False

Question 8

How are combined business/pleasure trips treated for travel within the United States as opposed to foreign travel?

Accepted Answer

The major difference is that transportat...

Question 9

Match the statements that relate to each other. (Note: Choice L may be used more than once.) 
-Cutback adjustment applies

Accepted Answer

A)  Cover charge paid to entertain client at a night club.
B)  Deductible even if taxpayer does not take the new job
C)  Company picnic sponsored by employer
D)  Use of Federal per diem allowance to substantiate meals while in travel status
E)  Does not have to be job relatedF) Can include cost of car insurance and automobile club duesG) Distribution from plan is taxableH) Distribution from plan is not taxableI) Expatriate (U.S. person who is employed overseas)  returns home to retireJ) Taxpayer moves to a new residence 55 miles closer to his present jobK) Country club membership feeL) Correct match not providedM) E) and F)
N) H) and I)

Question 10

Match the statements that relate to each other. (Note: Choice L may be used more than once.) 
-Automatic mileage method

Accepted Answer

A)  Must involve the same trade or business
B)  Must be for the convenience of the employer
C)  Meals while in route
D)  Lodging while in route
E)  Out-of-town job assignment lasts for more than one yearF) Can include actual cost of parkingG) Payment for services rendered based on tasks performedH) Excludes use of MACRS depreciationI) Taxpayer has tools and helper provided for himJ) Transportation must be allocated if taxpayer spends two weeks on business and one week sightseeingK) Paralegal obtains a law degreeL) Correct match not providedM) I) and L)
N) A) and H)

Question 11

Myra's classification of those who work for her as independent contractors is being questioned by the IRS. It is the position of the IRS that these workers are really employees. What type of factors can Myra utilize to justify her classification?

Accepted Answer

Myra needs to show that she has a reasonable basis for not treating her workers as employees. In this regard, can she prove reliance on any of the following?
-Judicial precedent, published ruling, or technical advice.
-A past IRS audit that resulted in no employment tax assessment.
-A longstanding practice of independent contractor status in the same industry.
Has Myra consistently treated these workers as independent contractors? Has she reported their earnings by filing Form 1099-MISC?

Question 12

Which, if any, of the following is an advantage of using the simplified method for determining the office in the home deduction?

Accepted Answer

A)   No depreciation on the personal residence has to be computed.
B)   The exclusive use requirement does not have to be met.
C)   Allows the expense to be classified as a deduction for AGI.
D)   Can also be used for a residence that is rented (not owned)  by the taxpayer.
E)   None of the above.F) C) and D)
G) B) and C)

Question 13

After she finishes working at her main job, Ann returns home, has dinner, then drives to her second job. Ann may deduct the mileage between her first and second job.

Accepted Answer

A) True 
 B)False

Question 14

If the cost of uniforms is deductible, their maintenance cost (e.g., laundry, dry cleaning, alterations) also is deductible.

Accepted Answer

A) True 
 B)False

Question 15

Elsie lives and works in Detroit. She is the regional sales manager for a national fast-food chain. Due to unusual developments, she is compelled to work six straight weeks in the Cleveland area. Instead of spending the weekend there, she flies home every Friday night and returns early Monday morning. The cost of coming home for the weekend approximates $600. Had she stayed in Cleveland, deductible meals and lodging would have been $700. How much, if any, may Elsie deduct as to each weekend?

Accepted Answer

$600 for each weekend, the les...

Question 16

Corey is the city sales manager for "RIBS," a national fast food franchise. Every working day, Corey drives his car as follows:
$\begin{array}{ll}
&\text { Miles }\
\text { Home to office } & 20 \
\text { Office to RIBS No. } 1 & 15 \
\text { RIBS No. } 1 \text { to No. } 2 & 18 \
\text { RIBS No. } 2 \text { to No. } 3 & 13 \
\text { RIBS No. } 3 \text { to home } & 30
\end{array}$

Corey's deductible mileage is:

A) 0 miles.
B) 50 miles.
C) 66 miles.
D) 76 miles.
E) None of the ahove

Accepted Answer

The answer of Corey is the city sales manager for...

Question 17

Madison is an instructor of fine arts at a local community college. If she spends $600 (not reimbursed) on art supplies for her classes, $250 of this amount can be claimed as a deduction for AGI.

Accepted Answer

A) True 
 B)False  False

Question 18

During 2014, Eva used her car as follows: 12,000 miles (business), 1,400 miles (commuting), and 4,000 miles (personal). In addition, she spent $440 for tolls (business) and $620 for parking (business). If Eva uses the automatic mileage method, what is the amount of her deduction?

Accepted Answer

$7.780. (12,000 mile...

Question 19

Concerning the deduction for moving expenses, what circumstances, if any, will excuse a taxpayer from meeting the time test of 39 or 78 weeks?

Accepted Answer

The time test will be disregarded if the...

Question 20

Match the statements that relate to each other. (Note: Choice L may be used more than once.) 
-Roth IRAs

Accepted Answer

A)  Cover charge paid to entertain client at a night club.
B)  Deductible even if taxpayer does not take the new job
C)  Company picnic sponsored by employer
D)  Use of Federal per diem allowance to substantiate meals while in travel status
E)  Does not have to be job relatedF) Can include cost of car insurance and automobile club duesG) Distribution from plan is taxableH) Distribution from plan is not taxableI) Expatriate (U.S. person who is employed overseas)  returns home to retireJ) Taxpayer moves to a new residence 55 miles closer to his present jobK) Country club membership feeL) Correct match not providedM) D) and K)
N) F) and I)

Exam 9: Deductions: Employee and Self-Employed-Related Expenses

If a taxpayer does not own a home but rents an apartment, the office in the home deduction is not available.

Correct Answer
verified

Correct Answer
verified
a. $5,000.
b. $5,000.
c. $3,000. (60% × ...
View Answer

Under the right circumstances, a taxpayer's meals and lodging expense can qualify as a deductible education expense.

Correct Answer
verified

Match the statements that relate to each other. (Note: Choice L may be used more than once.) -Actual cost method of determining car expense

Correct Answer
verified

Ashley and Matthew are husband and wife and both are practicing CPAs. On a joint return, Ashley gets to deduct her professional dues but Matthew does not. Explain.

Correct Answer
verified
Most likely Ashley is selfemployed, whi...
View Answer

There is no cutback adjustment for meals and entertainment as to employees who are subject to regulation by the U.S. Department of Transportation.

Correct Answer
verified
False

Janet, who lives and works in Newark, travels to Atlanta for a Thursday-Friday business conference. She stays over after the conference and visits relatives and friends on Saturday. Under certain circumstances, the meals and lodging expenses for Saturday can be considered as business related.

Correct Answer
verified

How are combined business/pleasure trips treated for travel within the United States as opposed to foreign travel?

Correct Answer
verified
The major difference is that transportat...
View Answer

Match the statements that relate to each other. (Note: Choice L may be used more than once.) -Cutback adjustment applies

Correct Answer
verified

Match the statements that relate to each other. (Note: Choice L may be used more than once.) -Automatic mileage method

Correct Answer
verified

Myra's classification of those who work for her as independent contractors is being questioned by the IRS. It is the position of the IRS that these workers are really employees. What type of factors can Myra utilize to justify her classification?

Which, if any, of the following is an advantage of using the simplified method for determining the office in the home deduction?

Correct Answer
verified

After she finishes working at her main job, Ann returns home, has dinner, then drives to her second job. Ann may deduct the mileage between her first and second job.

Correct Answer
verified

If the cost of uniforms is deductible, their maintenance cost (e.g., laundry, dry cleaning, alterations) also is deductible.

Correct Answer
verified

Correct Answer
verified
$600 for each weekend, the les...
View Answer

Correct Answer
verified

Madison is an instructor of fine arts at a local community college. If she spends $600 (not reimbursed) on art supplies for her classes, $250 of this amount can be claimed as a deduction for AGI.

Correct Answer
verified
False

During 2014, Eva used her car as follows: 12,000 miles (business), 1,400 miles (commuting), and 4,000 miles (personal). In addition, she spent $440 for tolls (business) and $620 for parking (business). If Eva uses the automatic mileage method, what is the amount of her deduction?

Correct Answer
verified
$7.780. (12,000 mile...
View Answer

Concerning the deduction for moving expenses, what circumstances, if any, will excuse a taxpayer from meeting the time test of 39 or 78 weeks?

Correct Answer
verified
The time test will be disregarded if the...
View Answer

Match the statements that relate to each other. (Note: Choice L may be used more than once.) -Roth IRAs

Correct Answer
verified

Exam 9: Deductions: Employee and Self-Employed-Related Expenses

If a taxpayer does not own a home but rents an apartment, the office in the home deduction is not available.

Correct AnswerverifiedShow Answer

Correct Answerverifieda. $5,000.b. $5,000.c. $3,000. (60% × ...View AnswerShow Answer

Under the right circumstances, a taxpayer's meals and lodging expense can qualify as a deductible education expense.

Correct AnswerverifiedShow Answer

Match the statements that relate to each other. (Note: Choice L may be used more than once.) -Actual cost method of determining car expense

Correct AnswerverifiedShow Answer

Ashley and Matthew are husband and wife and both are practicing CPAs. On a joint return, Ashley gets to deduct her professional dues but Matthew does not. Explain.

Correct AnswerverifiedMost likely Ashley is self­employed, whi...View AnswerShow Answer

There is no cutback adjustment for meals and entertainment as to employees who are subject to regulation by the U.S. Department of Transportation.

Correct AnswerverifiedFalse

Janet, who lives and works in Newark, travels to Atlanta for a Thursday-Friday business conference. She stays over after the conference and visits relatives and friends on Saturday. Under certain circumstances, the meals and lodging expenses for Saturday can be considered as business related.

Correct AnswerverifiedShow Answer

How are combined business/pleasure trips treated for travel within the United States as opposed to foreign travel?

Correct AnswerverifiedThe major difference is that transportat...View AnswerShow Answer

Match the statements that relate to each other. (Note: Choice L may be used more than once.) -Cutback adjustment applies

Correct AnswerverifiedShow Answer

Match the statements that relate to each other. (Note: Choice L may be used more than once.) -Automatic mileage method

Correct AnswerverifiedShow Answer

Myra's classification of those who work for her as independent contractors is being questioned by the IRS. It is the position of the IRS that these workers are really employees. What type of factors can Myra utilize to justify her classification?

Which, if any, of the following is an advantage of using the simplified method for determining the office in the home deduction?

Correct AnswerverifiedShow Answer

After she finishes working at her main job, Ann returns home, has dinner, then drives to her second job. Ann may deduct the mileage between her first and second job.

Correct AnswerverifiedShow Answer

If the cost of uniforms is deductible, their maintenance cost (e.g., laundry, dry cleaning, alterations) also is deductible.

Correct AnswerverifiedShow Answer

Correct Answerverified$600 for each weekend, the les...View AnswerShow Answer

Correct AnswerverifiedShow Answer

Madison is an instructor of fine arts at a local community college. If she spends $600 (not reimbursed) on art supplies for her classes, $250 of this amount can be claimed as a deduction for AGI.

Correct AnswerverifiedFalse

During 2014, Eva used her car as follows: 12,000 miles (business), 1,400 miles (commuting), and 4,000 miles (personal). In addition, she spent $440 for tolls (business) and $620 for parking (business). If Eva uses the automatic mileage method, what is the amount of her deduction?

Correct Answerverified$7.780. (12,000 mile...View AnswerShow Answer

Concerning the deduction for moving expenses, what circumstances, if any, will excuse a taxpayer from meeting the time test of 39 or 78 weeks?

Correct AnswerverifiedThe time test will be disregarded if the...View AnswerShow Answer

Match the statements that relate to each other. (Note: Choice L may be used more than once.) -Roth IRAs

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified
a. $5,000.
b. $5,000.
c. $3,000. (60% × ...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Most likely Ashley is selfemployed, whi...
View Answer

Correct Answer
verified
False

Correct Answer
verified

Correct Answer
verified
The major difference is that transportat...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
$600 for each weekend, the les...
View Answer

Correct Answer
verified

Correct Answer
verified
False

Correct Answer
verified
$7.780. (12,000 mile...
View Answer

Correct Answer
verified
The time test will be disregarded if the...
View Answer

Correct Answer
verified