Advanced Taxation 4311 Exam Guide: In-Depth Analysis WITH
Practice Questions 2024 2025
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Which of the following is a true statement?
A) Rental expenses are deducted for AGI but all other business expenses must be
itemized.
B) To deduct expenses associated with any profit motivated activity taxpayers must
maintain a high level of involvement or effort in the activity throughout the entire tax
year.
C) Business activities cannot require a relatively high level of involvement or effort from
the taxpayer.
D) Congress allows self-employed taxpayers to deduct the employer portion of t
D
Which of the following is a true statement?
A) The deduction of educational expense for a dependent is claimed as a miscellaneous
itemized deduction.
B) The deduction for the employer portion of self employment taxes is subject to a
phase-out limitation.
C) The deduction for interest on educational loans is subject to a phase-out limitation.
D) Taxpayers are allowed to deduct reasonable moving expenses even if the expenses
are reimbursed by their employers.
E) All of the above are false.
C
,Mike paid $6,200 of tuition for his dependent son to attend the University this year. How
much of this payment can Mike deduct as a for AGI deduction if he files married-joint
and reports modified AGI of $75,000 (assume the 2013 rules apply for purposes of the
qualified education expense deduction)?
A) $6,200
B) $4,000
C) $2,200
D) $2,000
E) None of the above - no deduction is allowed.
B
Ben is employed as a carpenter and his wife, Marilyn is a self-employed consultant.
Besides Ben's salary, Ben and Marilyn own a condominium that they only rent to
tourists. This year they paid $2,200 for utilities in the condo. Marilyn also paid self-
employment tax of $4,200 and Ben had $3,000 of Social Security taxes withheld from
his pay. Which of the following is a true statement?
A) One-half of Ben's social security tax is deductible for AGI.
B) The cost of the utilities is deductible for
B
Which of the following is a true statement?
A) A taxpayer cannot deduct medical expenses incurred for others unless they are
members of his immediate family.
B) A taxpayer can deduct medical expenses incurred for a qualified relative even if the
relative does not meet the gross income test.
C) Deductible medical expenses typically include botox treatments and other cosmetic
procedures incurred to enhance a taxpayer's appearance.
D) Deductible medical expenses do not include long-term care se
B
, Which of the following taxes will not qualify as an itemized deduction?
A) personal property taxes assessed on the value of specific property.
B) gasoline taxes on personal travel.
C) foreign income taxes paid this year.
D) state income taxes withheld from salary.
E) None of the above qualifies as an itemized deduction.
B
Curly donated inventory (ordinary income property) to a university. He purchased the
inventory seven months ago for $10,000, and on the date of the gift, it had a fair market
value of $2,000. What is his maximum charitable contribution deduction for this donation
if his AGI is $80,000?
A) $40,000
B) $2,000
C) $18,000
D) $10,000 if the church sells the inventory
E) None of the above
B
Which of the following is a true statement?
A) A taxpayer's standard deduction varies based on her medical expenses and
charitable contributions.
B) The standard deduction requires all taxpayers to substantiate and collect information
regarding itemized deductions.
C) A taxpayer's standard deduction amount may vary with her age.
D) Bunching itemized deductions is an example of tax planning by income shifting.
E) None of the above is true.
CWhich of the following is a true statement?
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