Question 1

Harry and Wilma are married and file a joint income tax return.On their tax return,they report $44,000 of adjusted gross income ($20,000 salary earned by Harry and $24,000 salary earned by Wilma) and claim two exemptions for their dependent children.During the year,they pay the following amounts to care for their 4-year old son and 6-year old daughter while they work.  Harry and Wilma may claim a credit for child and dependent care expenses of:

Accepted Answer

A)   $840.
B)   $1,040.
C)   $1,200.
D)   $1,240.
E)   None of the above.F) All of the above
G) A) and B)

Question 2

The credit for child and dependent care expenses is an example of a refundable credit.

Accepted Answer

A) True 
 B)False

Question 3

Even though an item of income is not subject to income tax withholding by a taxpayer's employer,it may be subject to the income tax.

Accepted Answer

A) True 
 B)False

Question 4

The incremental research activities credit is 20% of the qualified research expenses that exceed the base amount.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following correctly describes the tax credit for rehabilitation expenditures?

Accepted Answer

A)   The cost of enlarging any existing business building is a qualifying expenditure.
B)   The cost of facilities related to the building (e.g., a parking lot)  is a qualifying expenditure.
C)   No recapture provisions apply.
D)   No credit is allowed for the rehabilitation of personal use property.
E)   None of the above.F) D) and E)
G) B) and C)

Question 6

Green Company,in the renovation of its building,incurs $9,000 of expenditures that qualify for the disabled access credit.The disabled access credit is:

Accepted Answer

A)   $8,750.
B)   $4,500.
C)   $4,375.
D)   $4,250.
E)   None of the above.F) C) and D)
G) A) and E)

Question 7

An individual generally may claim a credit for adoption expenses in the year in which the expenses are paid.

Accepted Answer

A) True 
 B)False

Question 8

Child care payments to a relative are not eligible for the credit for child and dependent care expenses if the relative is a child (under age 19)of the taxpayer.

Accepted Answer

A) True 
 B)False

Question 9

The purpose of the work opportunity tax credit is to encourage employers to hire individuals from specified target groups traditionally subject to high rates of unemployment.

Accepted Answer

A) True 
 B)False

Question 10

Certain situations exist where the wage-bracket table method of determining income tax withholdings cannot be used.

Accepted Answer

A) True 
 B)False

Question 11

All taxpayers are eligible to take the basic research credit.

Accepted Answer

A) True 
 B)False

Question 12

If an employee holds two jobs during the year,an overwithholding of FICA tax will result.

Accepted Answer

A) True 
 B)False

Question 13

A taxpayer who qualifies for the low-income housing credit claims the credit over a 15-year period.

Accepted Answer

A) True 
 B)False

Question 14

Which,if any,of the following correctly describes the earned income credit?

Accepted Answer

A)   Would be available regardless of the amount of the taxpayer's adjusted gross income.
B)   Not available to a surviving spouse.
C)   A taxpayer must have a qualifying child to take advantage of the credit.
D)   Is a refundable credit.
E)   None of the above.F) D) and E)
G) A) and E)

Question 15

Explain the purpose of the disabled access credit and describe the general characteristics of its computation.

Accepted Answer

The disabled access credit is designed t...

Question 16

Cardinal Corporation hires two persons certified to be eligible employees for the work opportunity tax credit under the general rules (e.g.,food stamp recipients) ,each of whom is paid $9,000 during the year.As a result of this event,Cardinal Corporation may claim a work opportunity credit of:

Accepted Answer

A)   $1,440.
B)   $2,880.
C)   $4,800.
D)   $7,200.
E)   None of the above.F) A) and B)
G) A) and C)

Question 17

Refundable tax credits include the:

Accepted Answer

A)   Foreign tax credit.
B)   Tax credit for rehabilitation expenses.
C)   Credit for certain retirement plan contributions.
D)   Earned income credit.
E)   None of the above.F) B) and C)
G) B) and D)

Question 18

The American Opportunity credit is available per eligible student,while the lifetime learning credit is calculated per taxpayer.

Accepted Answer

A) True 
 B)False

Question 19

The education tax credits (i.e.,the American Opportunity credit and the lifetime learning credit)are available to help defray the cost of higher education regardless of the income level of the taxpayer.

Accepted Answer

A) True 
 B)False

Question 20

Kevin and Sue have two children,ages 8 and 14.They spend $6,200 per year on eligible employment related expenses for the care of their children after school.Kevin earned a salary of $20,000 and Sue earned a salary of $18,000.What is the amount of the credit for child and dependent care expenses?

Accepted Answer

A)   $690.
B)   $713.
C)   $1,380.
D)   $1,426.
E)   None of the above.F) B) and C)
G) A) and B)

Exam 13: Tax Credits and Payment Procedures

All taxpayers are eligible to take the basic research credit.

Correct Answer
verified

Explain the purpose of the disabled access credit and describe the general characteristics of its computation.

Correct Answer
verified
The disabled access credit is designed t...
View Answer

Kevin and Sue have two children,ages 8 and 14.They spend $6,200 per year on eligible employment related expenses for the care of their children after school.Kevin earned a salary of $20,000 and Sue earned a salary of $18,000.What is the amount of the credit for child and dependent care expenses?

Correct Answer
verified

Cardinal Corporation hires two persons certified to be eligible employees for the work opportunity tax credit under the general rules (e.g.,food stamp recipients) ,each of whom is paid $9,000 during the year.As a result of this event,Cardinal Corporation may claim a work opportunity credit of:

Correct Answer
verified

Which,if any,of the following correctly describes the earned income credit?

Correct Answer
verified

The American Opportunity credit is available per eligible student,while the lifetime learning credit is calculated per taxpayer.

Correct Answer
verified

If an employee holds two jobs during the year,an overwithholding of FICA tax will result.

Correct Answer
verified

The incremental research activities credit is 20% of the qualified research expenses that exceed the base amount.

Correct Answer
verified

The education tax credits (i.e.,the American Opportunity credit and the lifetime learning credit)are available to help defray the cost of higher education regardless of the income level of the taxpayer.

Correct Answer
verified

Refundable tax credits include the:

Correct Answer
verified

The credit for child and dependent care expenses is an example of a refundable credit.

Correct Answer
verified

Child care payments to a relative are not eligible for the credit for child and dependent care expenses if the relative is a child (under age 19)of the taxpayer.

Correct Answer
verified

A taxpayer who qualifies for the low-income housing credit claims the credit over a 15-year period.

Correct Answer
verified

An individual generally may claim a credit for adoption expenses in the year in which the expenses are paid.

Correct Answer
verified

Even though an item of income is not subject to income tax withholding by a taxpayer's employer,it may be subject to the income tax.

Correct Answer
verified

Which of the following correctly describes the tax credit for rehabilitation expenditures?

Correct Answer
verified

The purpose of the work opportunity tax credit is to encourage employers to hire individuals from specified target groups traditionally subject to high rates of unemployment.

Correct Answer
verified

Green Company,in the renovation of its building,incurs $9,000 of expenditures that qualify for the disabled access credit.The disabled access credit is:

Correct Answer
verified

Certain situations exist where the wage-bracket table method of determining income tax withholdings cannot be used.

Correct Answer
verified

Correct Answer
verified

Exam 13: Tax Credits and Payment Procedures

All taxpayers are eligible to take the basic research credit.

Correct AnswerverifiedShow Answer

Explain the purpose of the disabled access credit and describe the general characteristics of its computation.

Correct AnswerverifiedThe disabled access credit is designed t...View AnswerShow Answer

Kevin and Sue have two children,ages 8 and 14.They spend $6,200 per year on eligible employment related expenses for the care of their children after school.Kevin earned a salary of $20,000 and Sue earned a salary of $18,000.What is the amount of the credit for child and dependent care expenses?

Correct AnswerverifiedShow Answer

Cardinal Corporation hires two persons certified to be eligible employees for the work opportunity tax credit under the general rules (e.g.,food stamp recipients) ,each of whom is paid $9,000 during the year.As a result of this event,Cardinal Corporation may claim a work opportunity credit of:

Correct AnswerverifiedShow Answer

Which,if any,of the following correctly describes the earned income credit?

Correct AnswerverifiedShow Answer

The American Opportunity credit is available per eligible student,while the lifetime learning credit is calculated per taxpayer.

Correct AnswerverifiedShow Answer

If an employee holds two jobs during the year,an overwithholding of FICA tax will result.

Correct AnswerverifiedShow Answer

The incremental research activities credit is 20% of the qualified research expenses that exceed the base amount.

Correct AnswerverifiedShow Answer

The education tax credits (i.e.,the American Opportunity credit and the lifetime learning credit)are available to help defray the cost of higher education regardless of the income level of the taxpayer.

Correct AnswerverifiedShow Answer

Refundable tax credits include the:

Correct AnswerverifiedShow Answer

The credit for child and dependent care expenses is an example of a refundable credit.

Correct AnswerverifiedShow Answer

Child care payments to a relative are not eligible for the credit for child and dependent care expenses if the relative is a child (under age 19)of the taxpayer.

Correct AnswerverifiedShow Answer

A taxpayer who qualifies for the low-income housing credit claims the credit over a 15-year period.

Correct AnswerverifiedShow Answer

An individual generally may claim a credit for adoption expenses in the year in which the expenses are paid.

Correct AnswerverifiedShow Answer

Even though an item of income is not subject to income tax withholding by a taxpayer's employer,it may be subject to the income tax.

Correct AnswerverifiedShow Answer

Which of the following correctly describes the tax credit for rehabilitation expenditures?

Correct AnswerverifiedShow Answer

The purpose of the work opportunity tax credit is to encourage employers to hire individuals from specified target groups traditionally subject to high rates of unemployment.

Correct AnswerverifiedShow Answer

Green Company,in the renovation of its building,incurs $9,000 of expenditures that qualify for the disabled access credit.The disabled access credit is:

Correct AnswerverifiedShow Answer

Certain situations exist where the wage-bracket table method of determining income tax withholdings cannot be used.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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The disabled access credit is designed t...
View Answer

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