The lifetime learning credit can be used toward the cost of any course of instruction to acquire or improve a taxpayer's job skills, no matter the age of the taxpayer. True or False True False

Which of the followings is included in taxpayer’s gross income (i.e., taxable)? a.Compensatory damage payments received from physical injury by accident caused by other party. b.Punitive damage payments received. c.Accident and health insurance payments received as loss of income under the policy purchased by the taxpayer. d.Qualified employee discount up to the gross profit percentage for goods. It is nondiscriminatory and employees work for the line of business in which the goods are being sold. e. Employee’s salary during the year, which is contributed to employee’s qualified pension plan.

A taxpayer must report the full amount of gambling winnings on Schedule 1, line 8. How are gambling losses reported? Select one: a. On Schedule 1, line 22 Ob. On Schedule A, line 16, limited to gambling winnings included on Schedule 1 OC. Subtracted from gambling winnings before reporting on Schedule 1, line 8 Od. On Form 1040, line Ba as an adjustment to income

Which of the following statement is true?    A. Lifetime learning tax credit is available for each qualified student including taxpayers and dependents.  B. Tax credits reduces a taxpayer’s taxable income dollar for dollar.  C. The child tax credit is subject to phase-out based on the taxpayer’s AGI.  D. To qualify for the earned income credit, the taxpayer must have a qualified dependent.  E. The American opportunity credit is available only for those students who are in their first or second year of post-secondary education.

Mark each statement below as either "True" or "False" regarding the standard deduction and itemized deductions. a. The standard deduction is an amount that varies with filing status.   b. A taxpayer should claim the smaller of the standard deduction or the total allowed itemized deductions.   c. Total itemized deductions depend on the amount and type of items, with some items having limitations based on AGI.   d. Taxpayers who are 65 years of age or older or blind are entitled to an additional itemized deduction amount.

In order to meet the material participation test for a rental real estate activity, over what number of hours of personal service must the taxpayer work in rental real estate during the year?

An allowable capital loss realized in a year can first be deducted in the current year against taxable capital gain. If any amount of the loss is still not deducted what other options does the taxpayer have? Write-off from current year employment income Forget about the remaining loss Carry back or carry forward to taxable capital gains Carry back or carry forward to all sources of income

What is required for the employer's payment of a student's loan to be tax - free to the student?Payment must not exceed $2,500Payment must be only for loan principal Payment must be only for loan interestThe student employee must not have the option to receive the funds as taxable income

A landlord who receives prepaid rent is required to report that amount as gross income when the payment is received. Why would Congress choose to do this? What problem does this create for the taxpayer? C O A. Congress taxes prepaid rental income due to the concern that taxpayers who spend the money will be unable to pay the tax when t comes due. The problem created for taxpayers is that they are taxed before they incur related expenses, such as repairs, insurance, and depreciation. Therefore, there is a mismatching of revenue and expense. O B. O C. Congress taxes prepaid rental income to collect more taxes from a taxpayer by increasing their tax bracket with the additional income. The problem this causes for the taxpayer is inconsistent taxable income from year to year and increases the risk of an audit. O D. Congress taxes prepaid rental income due to numerous landlords not reporting this income in the following tax year. The problem created for taxpayers is that they are taxed…