Question 1

Match the statements that relate to each other. (Note: Choice L may be used more than once.) 
-Characteristic of a taxpayer who is self-employed

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) A) and B)
N) A) and C)

Question 2

Rod uses his automobile for both business and personal use and claims the automatic mileage rate for all purposes. During 2014, his mileage was as follows:
 $\begin{array}{l}
\begin{array}{lr}&\text { Míles Driven }\
\text { Personal } & 4,000 \
\text { Business } & 8,000 \
\text { Qualifying moving expense } & 3,500 \
\text { Medical } & 1,800 \
\text { Charitable } & 1,500 \
\text { Qualifying education (MBA program) } & 800
\end{array}\
\text { How much can Rod claim for mileage? }
\end{array}$

Accepted Answer

$6,384 [(8,800 miles × $0.56, ...

Question 3

Which, if any, of the following expenses is subject to the 2%-of-AGI floor?

Accepted Answer

A)   Gambling losses (to the extent of gambling gains) .
B)   Moving expenses (not reimbursed by employer) .
C)   Teaching supplies (in excess of $250)  purchased by a fifth grade teacher.
D)   Union dues of self-employed machinist.
E)   None of the above.F) A) and B)
G) A) and D)

Question 4

A participant has an adjusted basis of $0 in any nondeductible contributions to a traditional IRA.

Accepted Answer

A) True 
 B)False

Question 5

Distributions from a Roth IRA that are subject to taxation are treated first as from earnings and last as from contributions.

Accepted Answer

A) True 
 B)False

Question 6

A taxpayer who uses the automatic mileage method for the business use of an automobile can change to the actual cost method in a later year.

Accepted Answer

A) True 
 B)False

Question 7

After the automatic mileage rate has been set by the IRS for a year, it cannot later be changed by the IRS.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following expenses, if any, qualify as deductible?

Accepted Answer

A)   Contributions to a Coverdell Education Savings Account (CES
A)  .
B)   Contributions to a qualified tuition program (§ 529 plan) .
C)   Job hunting expense of FBI agent who applies for the job of city manager of Beaumont (TX) .
D)   Contribution to a traditional IRA.
E)   None of the above.F) A) and C)
G) A) and E)

Question 9

Match the statements that relate to each other. (Note: Choice L may be used more than once.) 
-Tax home has changed

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) D) and F)
N) B) and F)

Question 10

A taxpayer who maintains an office in the home to conduct his only business will not have nondeductible commuting expense.

Accepted Answer

A) True 
 B)False

Question 11

Sue performs services for Lynn. Regarding this arrangement, use the legend provided to classify each statement.
-Lynn determines when the services are to be performed.

Accepted Answer

A)  Indicates employee status.
B)  Indicates independent contractor status.C) A) and B)
D) undefined

Question 12

Cathy takes five key clients to a nightclub and incurs the following costs: $320 limousine rental, $460 cover charge, $920 drinks and dinner, and $200 tips. Several days after the function, Cathy mails each client a pen costing $25. To the cost must be added $4 for engraving of the client's name. Assuming adequate substantiation and a business justification, what is Cathy's deduction?

Accepted Answer

$1,255. $320 + [($460 + $920 +...

Question 13

A taxpayer who uses the automatic mileage method to compute auto expenses can also deduct the business portion of tolls and parking.

Accepted Answer

A) True 
 B)False

Question 14

An education expense deduction may be allowed even if the education results in a promotion or pay raise for the employee.

Accepted Answer

A) True 
 B)False

Question 15

Taylor performs services for Jonathan on a regular basis. There exists considerable doubt as to whether Taylor is an employee or an independent contractor.
a. What can Jonathan do to clarify the matter?
b. Suppose Jonathan treats Taylor as an independent contractor but Taylor thinks she is an employee. What is Taylor's recourse, if any?

Accepted Answer

e. Jonathan can obtain a ruling from the...

Question 16

A participant, who is age 38, in a cash or deferred arrangement plan [§ 401(k) ] may contribute up to what amount in 2014?

Accepted Answer

A)   $12,000.
B)   $16,500.
C)   $17,000.
D)   $17,500.
E)   None of the above.F) None of the above
G) B) and D)

Question 17

Qualifying job search expenses are deductible even if the taxpayer does not change jobs.

Accepted Answer

A) True 
 B)False

Question 18

Which, if any, of the following expenses are not subject to the 2%-of-AGI floor?

Accepted Answer

A)   Safety shoes purchased by an employed plumber.
B)   Reimbursed employee expenses. Taxpayer-employee renders an adequate accounting to the employer.
C)   Unreimbursed employee expenses.
D)   Tax return preparation fee paid by a non-employed retiree.
E)   None of the above.F) B) and E)
G) A) and D)

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

A taxpayer who uses the automatic mileage method for the business use of an automobile can change to the actual cost method in a later year.

Correct Answer
verified

Distributions from a Roth IRA that are subject to taxation are treated first as from earnings and last as from contributions.

Correct Answer
verified

An education expense deduction may be allowed even if the education results in a promotion or pay raise for the employee.

Correct Answer
verified

Which of the following expenses, if any, qualify as deductible?

Correct Answer
verified

Correct Answer
verified
e. Jonathan can obtain a ruling from the...
View Answer

Which, if any, of the following expenses is subject to the 2%-of-AGI floor?

Correct Answer
verified

Sue performs services for Lynn. Regarding this arrangement, use the legend provided to classify each statement. -Lynn determines when the services are to be performed.

Correct Answer
verified

Match the statements that relate to each other. (Note: Choice L may be used more than once.) -Characteristic of a taxpayer who is self-employed

Correct Answer
verified

Match the statements that relate to each other. (Note: Choice L may be used more than once.) -Tax home has changed

Correct Answer
verified

A participant has an adjusted basis of $0 in any nondeductible contributions to a traditional IRA.

Correct Answer
verified

Qualifying job search expenses are deductible even if the taxpayer does not change jobs.

Correct Answer
verified

Correct Answer
verified
$6,384 [(8,800 miles × $0.56, ...
View Answer

A taxpayer who uses the automatic mileage method to compute auto expenses can also deduct the business portion of tolls and parking.

Correct Answer
verified

A participant, who is age 38, in a cash or deferred arrangement plan [§ 401(k) ] may contribute up to what amount in 2014?

Correct Answer
verified

A taxpayer who maintains an office in the home to conduct his only business will not have nondeductible commuting expense.

Correct Answer
verified

Which, if any, of the following expenses are not subject to the 2%-of-AGI floor?

Correct Answer
verified

Correct Answer
verified
$1,255. $320 + [($460 + $920 +...
View Answer

After the automatic mileage rate has been set by the IRS for a year, it cannot later be changed by the IRS.

Correct Answer
verified

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

A taxpayer who uses the automatic mileage method for the business use of an automobile can change to the actual cost method in a later year.

Correct AnswerverifiedShow Answer

Distributions from a Roth IRA that are subject to taxation are treated first as from earnings and last as from contributions.

Correct AnswerverifiedShow Answer

An education expense deduction may be allowed even if the education results in a promotion or pay raise for the employee.

Correct AnswerverifiedShow Answer

Which of the following expenses, if any, qualify as deductible?

Correct AnswerverifiedShow Answer

Correct Answerverifiede. Jonathan can obtain a ruling from the...View AnswerShow Answer

Which, if any, of the following expenses is subject to the 2%-of-AGI floor?

Correct AnswerverifiedShow Answer

Sue performs services for Lynn. Regarding this arrangement, use the legend provided to classify each statement. -Lynn determines when the services are to be performed.

Correct AnswerverifiedShow Answer

Match the statements that relate to each other. (Note: Choice L may be used more than once.) -Characteristic of a taxpayer who is self-employed

Correct AnswerverifiedShow Answer

Match the statements that relate to each other. (Note: Choice L may be used more than once.) -Tax home has changed

Correct AnswerverifiedShow Answer

A participant has an adjusted basis of $0 in any nondeductible contributions to a traditional IRA.

Correct AnswerverifiedShow Answer

Qualifying job search expenses are deductible even if the taxpayer does not change jobs.

Correct AnswerverifiedShow Answer

Correct Answerverified$6,384 [(8,800 miles × $0.56, ...View AnswerShow Answer

A taxpayer who uses the automatic mileage method to compute auto expenses can also deduct the business portion of tolls and parking.

Correct AnswerverifiedShow Answer

A participant, who is age 38, in a cash or deferred arrangement plan [§ 401(k) ] may contribute up to what amount in 2014?

Correct AnswerverifiedShow Answer

A taxpayer who maintains an office in the home to conduct his only business will not have nondeductible commuting expense.

Correct AnswerverifiedShow Answer

Which, if any, of the following expenses are not subject to the 2%-of-AGI floor?

Correct AnswerverifiedShow Answer

Correct Answerverified$1,255. $320 + [($460 + $920 +...View AnswerShow Answer

After the automatic mileage rate has been set by the IRS for a year, it cannot later be changed by the IRS.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
e. Jonathan can obtain a ruling from the...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
$6,384 [(8,800 miles × $0.56, ...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
$1,255. $320 + [($460 + $920 +...
View Answer

Correct Answer
verified