LSU ACCT 3221 Chapter 4 | Questions and Answers True/False: Tuition, fees, books, supplies, room, board, and other necessary expenses of attendance are qualified education expenses for purposes of the student loan interest deduction. True True/False: For 2009, the amount of the student loan inter...
True/False: Tuition, fees, books, supplies, room, board, and other necessary expenses
of attendance are qualified education expenses for purposes of the student loan interest
deduction.
True
True/False: For 2009, the amount of the student loan interest deduction is limited to
$3,500.
False
True/False: The student loan interest deduction may be limited based on the modified
AGI of the taxpayer.
True
True/False: For the interest on a student loan to qualify for the student loan interest
deduction, the student must be enrolled full-time.
False
True/False: A Health Savings Account (HSA) is a tax-exempt savings account to be
used for qualified medical expenses.
True
True/False: To be eligible to fund a Health Savings Account (HSA), a taxpayer must be
a self-employed, or an employee (or spouse) of an employer who maintains a high
deductible health plan, or an employee of a company that offers no health coverage and
the employee has purchased a high deductible health plan on their own.
True
True/False: Distributions from Health Savings Accounts (HSAs) are subject to tax, if
they are used to pay for qualified medical expenses.
False
True/False: For 2009, unreimbursed qualifying moving expenses are an itemized
deduction.
False
True/False: Deductible moving expenses include moving household goods and
personal effects from the old residence to the new residence.
True
True/False: There is both a distance test and a time test that must be met to be able to
deduct qualifying moving expenses.
True
, True/False: For the moving expense distance test, the new job location must be at least
100 miles farther from the taxpayer's old residence than was the old job location.
False
True/False: Self-employment tax is calculated on the gross earnings of the business.
False
True/False: Self-employed persons are allowed a for AGI deduction equal to one-half of
the self-employment tax imposed.
True
True/False: Qualified self-employed taxpayers can deduct, as a for AGI deduction, 80%
of health insurance payments for 2009.
False
True/False: The self-employed health insurance deduction is also available to a partner
in a partnership and to a shareholder in a Subchapter S corporation who owns more
than 2% of the stock in the corporation.
True
True/False: If a taxpayer incurs an early withdrawal of savings penalty, the taxpayer is
entitled to report the penalty as a for AGI deduction on Form 1040.
True
True/False: The payment of alimony has tax ramifications. These tax ramifications only
affect the payor of the alimony.
False
True/False: Under a divorce agreement executed in 2009, periodic payments of either
cash or property must be made at regular intervals to be deductible as alimony.
False
True/False: In lieu of making payments of alimony directly to a former spouse,
payments to a third party on behalf of the former spouse can qualify as alimony.
True
True/False: Roberto files his tax return as married filing separately. He has not lived
with his wife for over three years. In the current year, by order of the court, he paid her
$500 per month for 12 months as separate maintenance. He will be able to deduct
$6,000 as alimony for the year.
True
True/False: Eligible educators can deduct up to $250 of qualified educational expenses
as above-the-line deduction.
True
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