A) Only I is true.
B) Only III is true.
C) Only I and III are true.
D) I, II, and III are true.
E) None of the above.
G) B) and E)
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A) If an employee's wages are reduced by $5,000 and the employee is in the 28% marginal tax bracket, the employee would benefit from the offer.
B) If an employee's wages are reduced by $4,000 and the employee is in the 15% marginal tax bracket, the employee would benefit from the offer.
C) If an employee's wages are reduced by $6,000 and the employee is in the 35% marginal tax bracket, the employee would benefit from the offer.
D) a., b., and c.
E) None of the above.
G) A) and B)
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The Federal income tax system provides d...View Answer
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The state and local governments benefit ...View Answer
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A) Harold must recognize $20,000 ($80,000 - $60,000) of gross income.
B) Harold is not required to recognize gross income, but must reduce his cost basis in the land to $130,000.
C) Harold is not required to recognize gross income, since he paid the debt before it was due.
D) Jewel must recognize gross income of $20,000 ($80,000 - $60,000) from discharge of the debt.
E) None of the above.
G) A) and D)
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B) False
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Bob realizes a $25,000 increase in wealt...View Answer
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B) False
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A) Heather reduced her salary by $1,200, actually spent $1,500, and received only $1,200 as reimbursement for her medical expenses. Heather's gross income will be reduced by $1,500.
B) Heather reduced her salary by $1,200, and received only $900 as reimbursement for her actual medical expenses. She is not refunded the $300 remaining balance, but her gross income is reduced by $1,200.
C) Heather reduced her salary by $1,200, and received only $800 as reimbursement for her medical expenses. She is not refunded the $400. Her gross income is reduced by $800.
D) Heather reduced her salary by $1,200, and received only $900 as reimbursement for her medical expenses. She forfeits the $300. Her gross income is reduced by $300.
E) None of the above.
G) A) and B)
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B) False
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B) False
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A) The taxpayer can exclude $60,000 from U.S. gross income for 2011 because the total salary earned in the foreign country in 2011 was less than the annual foreign earned income exclusion, but the dividends of $5,000 must be included in gross income.
B) The taxpayer can exclude a portion of the compensation income from U.S. gross income in 2011 and 2012, but must include the dividend income of $5,000 in gross income.
C) The taxpayer can exclude from U.S. gross income $60,000 salary in 2011, but in 2011 the taxpayer will exceed the twelve month limitation and, therefore, all of the 2012 compensation must be included in gross income. All of the dividends must be included in 2011 gross income.
D) The taxpayer can exclude a portion of the salary from U.S. gross income in 2011 and 2012, and all of the dividend income.
E) None of the above.
G) A) and C)
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A) If Louise worked in the foreign branch from May 1, 2011 until October 31, 2012, she may exclude $40,000 from gross income in 2011 and exclude $50,000 in 2012.
B) If Louise worked in the foreign branch from May 1, 2011 until October 31, 2012, she cannot exclude anything from gross income because she was not present in the country for 330 days in either year.
C) If Louise began work in the foreign country on May 1, 2011, she must work through November 30, 2012 in order to exclude $55,000 from gross income in 2012 but none in 2011.
D) Louise will not be allowed to exclude any foreign earned income because she made less than $95,100.
E) None of the above.
G) B) and D)
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A) If Tonya itemized her deductions in 2012 on her Federal income tax return and her itemized deductions exceeded the standard deduction by at least $600, she must amend her 2012 return to reduce her itemized deductions.
B) If Tonya itemized her deductions in 2012 on her Federal income tax return and her itemized deductions exceeded the standard deduction by at least $600, she must include the $600 in her 2013 gross income.
C) If Tonya itemized her deductions in 2012, she must amend her 2012 Federal income tax return and use the standard deduction.
D) Tonya must recognize $600 as income from discharge of indebtedness.
E) None of the above.
G) A) and C)
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A) The necklace is a nontaxable gift received by Sharon because the friend was not legally required to make the gift.
B) The value of the necklace is not included in Sharon's gross income unless she sells it.
C) The value of the necklace is not included in Sharon's gross income because passing the information was an illegal act and the SEC can confiscate the necklace.
D) The value of the necklace must be included in Sharon's gross income for the tax year it was received by her.
E) None of the above.
G) A) and E)
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