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McGraw-Hill's Essentials of Federal Taxation 2024 Edition
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McGraw-Hill's Essentials of Federal Taxation 2024 Edition
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TEST BANK For McGraw-Hill's Essentials of Federal Taxation 2024 Edition, 15th Edition By Brian Spilker, Benjamin Ayers, Verified Chapters 1 - 17, Complete
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TEST BANK For McGraw-Hill's Essentials of Federal Taxation 2024 Edition, 15th Edition By Brian Spilker, Benjamin Ayers, Verified Chapters 1 - 17, Complete
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McGraw-Hill's Essentials of Federal Taxation 2024 Edition
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TEST BANK For McGraw-Hill's Essentials of Federal Taxation2024 Edition, 15th Edition By Brian Spilker, Benjamin Ayers,
Verified Chapters 1 - 17, Complete
What is a tax base? - ANSWER: amount of income to which a tax rate is applied to
what type of tax rates are there? - ANSWER: flat or progressive
whats the difference between flat and progressive tax rates? - ANSWER: flat- same
rate across all incomes
progressive- tax rate increases as income increases
how do we calculate the marginal tax? - ANSWER: use tax rate schedule table
based on amount of income over the threshold, apply percentage to difference and
add the given tax on top and that becomes taxable income
what are the major types of taxes? - ANSWER: property, transaction,
estate/inheritance, gift, employment/unemployment, income
what are the two types of property assets eligible for tax? - ANSWER: buildings and
anything else that is considered personal for personal use
what is an example of transaction tax? - ANSWER: state sales tax
how much can one exclude from taxes via gifts? - ANSWER: 16,000
How does the federal government determine estate tax amount? - ANSWER: based
on FMV of estate
what are the two types of employment/unemployment taxes that are taken out? -
ANSWER: FICA and FUTA
what is composed in FICA taxes? - ANSWER: Social security and Medicare payments
what is composed in FUTA taxes? - ANSWER: all unemployment funds that are used
for the unemployed
T/F- income tax is imposed at all levels of government - ANSWER: True
How do most jurisdictions go about income tax collection? - ANSWER: through a
withholding system or pay as you go
What is the formula for calc corporate taxable income? - ANSWER: Income -
deductions
, what are the two dependents taxpayers can claim to lower income tax? - ANSWER:
qualifying child and relative
what are the 4 tests a dependent has to pass to be considered a qualifying child? -
ANSWER: relationships
abode
age
support
T/F- if a dependent passes some of the tests they can still be considered a qualifying
dependent - ANSWER: False- must pass all tests
what are the relationships that pass a dependent as a qualifying child? - ANSWER:
son/daughter
stepson/daughter
brother/sister
stepbrother/sister
half sibling
descendant of other relative- nephew, grandchildren
adopted or foster children
what is the criteria for the abode test of qualifying child? - ANSWER: child must live
at taxpayers home for more than half the year
what is the criteria for the age test of qualifying child? - ANSWER: child must be
under 19 or 24 if a student in school
what is the criteria for the support test of qualifying child? - ANSWER: child must not
be providing more than half of their own support
what are the three tests that a dependent must pass to be a qualifying relative? -
ANSWER: relationship
gross income
support
what is the criteria for the relationship test for qualifying relative? - ANSWER: can
include:
grandparents, parents
uncles/aunts
in law relatives
Does one have to be related to the taxpayer to be considered a qualifying relative? -
ANSWER: no- as long as they live with taxpayer all year round they can be
considered qualifying relative
what is the criteria for gross income test for qualifying relative? - ANSWER:
dependents gross income has to be less than 4,400 (for 2022)
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