Exam (elaborations)
Enrolled Agent Exam Questions and Answers- Part 2
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Enrolled Agent Exam Questions and Answers- Part 2
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Enrolled Agent - Part 2Definition of Self-employed - Answer -You are self-employed if you carry on a trade or business as a sole
proprietor or an independent contractor.
Statutory employees - Answer -1. Pay FICA tax through their employer, and so do not pay self-
employment tax (Employer pays Social Security and Medicare taxes in the form of FICA).
2. Less expensive to hire than regular employees because the employer does not have to pay
unemployment taxes.
3. Use Schedule C or C-EZ to report their wages and expenses.
4. A statutory employee has a check mark in box 13 of his or her Form W-2, Wage and Tax Statement.
Unincorporated businesses owned and operated by spouses... - Answer -who share in the profits and
losses is a PARTNERSHIP (whether or not they have a formal partnership agreement) , with 2
EXCEPTIONS:
1. Community income -business can be treated either as a sole proprietorship or a partnership.
2. Qualified joint venture
Qualified Joint venture
TAGS: SOCIAL SECURITY - Answer -1. Both spouses who materially participate as the only members of a
jointly owned and operated business (and file MFJ) can make a joint election to be treated as a qualified
joint venture instead of a partnership for the tax year.
,2. Income gain, loss, deduction, and credit attributable to the business divided between spouses in
accordance
with respective interests and filed on separate Schedule C or C-EZ and separate Schedule SE.
3. Gives each spouse credit for social security earnings on which retirement benefits are based.
The only states with community property laws are: - Answer -1. Arizona
2. California
3. Idaho
4. Louisiana
5. Nevada
6. New Mexico
7. Texas
8. Washington
9. Wisconsin.
or keyword: C TAIL NN WW
The corporation must file Form 2553, Election by a Small Business Corporation, before what date? -
Answer -
Form 8832 (Entity Classification Election) - Answer -
Croaker, Inc. is a taxable domestic corporation. Dana Corporation, a large manufacturing corporation,
owns 15% of Croaker, Inc.'s outstanding stock. In 2015, Dana Corporation received $100,000 in
dividends from Croaker, Inc. Dana Corporation received no other dividends in 2015. Dana Corporation
may deduct, within certain limits, what percentage of the dividends received? - Answer -
Publication 334 - Answer -Tax Guide for Small Business
(approx 40 pgs)
, Form 1065 - Answer -U.S. Return of Partnership Income
Form 1099-MISC, Miscellaneous
Income - Answer -Payments of $600 or more to non-employees
Rent payments of $600 or more, other than rents paid
to real estate agents.
Prizes and awards of $600 or more that are not for
services.
Royalty payments of $10 or more.
Sales of $5,000 or more of consumer goods to a person for resale anywhere other than in a permanent
retail establishment.
Included on Schedule C as Self-employed Income:
(subject to Self-employment taxes) - Answer -1. Non-employee compensation
2. Partnership income for General Partners (GP)
3. Compensation for Director of a corporation
4. Minister salary or housing allowance
5. Rental Income (Dealer)
6. Gain from casualty loss paid by insurance co. for inventory
Not to be included as self-employed earnings: - Answer -1. Salaries & wages
2. Partnership income for Limited Partners (LP)
3. S Corp earnings
Form 1128 - Answer -1. Application To Adopt, Change or Retain a Tax Year
2. Due by 15th day, second month of new tax year
Form 3115 - Answer -Application for Change in Accounting Method
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