FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 6: Deductions and Losses: in General

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 21

True/False

Review LaterAdd Note

Review Later

Two-thirds of treble damage payments under the antitrust law are not deductible.

Correct Answer

verified

Show Answer

Question 22

Multiple Choice

Review LaterAdd Note

Review Later

Payments by a cash basis taxpayer of capital expenditures:

A) Must be expensed at the time of payment.
B) Must be expensed by the end of the first year after the asset is acquired.
C) Must be deducted over the actual or statutory life of the asset.
D) Can be deducted in the year the taxpayer chooses.
E) None of the above.

Correct Answer

verified

Show Answer

Question 23

Essay

Review LaterAdd Note

How can an individual's consultation with a lawyer be classified as a deduction for AGI in some cases and a deduction from AGI in other instances?

Under what circumstances may a taxpayer deduct the expenses of investigating a possible business acquisition,if (1) the business is not acquired; and (2) the business is acquired?

Melba incurred the following expenses for her dependent daughter during the current year: ​ How much may Melba deduct in computing her itemized deductions?

Marsha is single,had gross income of $50,000,and incurred the following expenses: ​ Her AGI is:

Which of the following can be claimed as a deduction for AGI?

If a taxpayer operated an illegal business (not drug trafficking),what expenses can be deducted and what expenses are disallowed?

Mitch is in the 28% tax bracket.He may receive a different tax benefit for a $2,000 expenditure that is classified as a deduction from AGI than he will receive for a $1,000 expenditure that is classified as a deduction for AGI.

If a vacation home is classified as primarily personal use (i.e.,rented for fewer than 15 days),none of the related expenses can be deducted.

An expense need not be recurring in order to be "ordinary."

Which of the following statements is correct in connection with the investigation of a business?

Paula is the sole shareholder of Violet,Inc.For 2017,she receives from Violet a salary of $300,000 and dividends of $100,000.Violet's taxable income for 2017 is $500,000.On audit,the IRS treats $100,000 of Paula's salary as unreasonable.Which of the following statements is correct?

Susan is a sales representative for a U.S.weapons manufacturer.She makes a $100,000 "grease" payment to a U.S.government official associated with a weapons purchase by the U.S.Army.She makes a similar payment to a Saudi Arabian government official associated with a similar sale.Neither of these payments is deductible by Susan's employer.

Which of the following is a required test for the deduction of a business expense?

Legal expenses incurred in connection with rental property are deductions from AGI.

Bridgett's son,Clyde,is $12,000 in arrears on his residential mortgage payments.Of the $12,000,$7,500 represents interest and $4,500 represents principal. a.​If Bridgett pays the $12,000 to the lender, how much can she deduct? How much can Clyde deduct? b.​​If Bridgett pays the $7,500 of interest to the lender and loans or gives $4,500 to Clyde, who pays the $4,500 of principal, how much can Bridgett deduct? How much can Clyde deduct? c.​If Bridgett gives or lends the $12,000 to Clyde who pays the lender, how much can he deduct? How much can Bridgett deduct? d.Advise Bridgett and Clyde on how the payment should be made.

Under what circumstance can a bribe be deducted?

Calculate the net income includible in taxable income for the following hobby:

If a vacation home is rented for less than 15 days during a year,the only expenses that can be deducted are mortgage interest,property taxes,and personal casualty losses.