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South-Western Federal Taxation 2018: Comprehensive 41st Edition Test Bank - Document preview page 1

South-Western Federal Taxation 2018: Comprehensive 41st Edition Test Bank - Page 1

Document preview content for South-Western Federal Taxation 2018: Comprehensive 41st Edition Test Bank

South-Western Federal Taxation 2018: Comprehensive 41st Edition Test Bank

Ensure exam success with South-Western Federal Taxation 2018: Comprehensive 41st Edition Test Bank, featuring key insights, exam tricks, and practice exercises.

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South-Western Federal Taxation 2018: Comprehensive 41st Edition Test Bank - Page 1 preview image1.TheFederalincometaxonindividualsgeneratesmorerevenuethantheFederalincometaxoncorporations.a.Trueb.FalseANSWER:TruePOINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-02-LO:1-02NATIONALSTANDARDS:UnitedStates-BUSPROG:Technology:Technology:-BUSPROG:TechnologySTATESTANDARDS:UnitedStates-AK-AICPA:FN-ResearchKEYWORDS:Bloom's:KnowledgeOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM2.Becausethelawiscomplicated,mostindividualtaxpayersarenotabletocompletetheirFederalincometaxreturnswithoutoutsideassistance.a.Trueb.FalseANSWER:TrueRATIONALE:Morethan50%usetaxreturnpreparersandabout33%purchasetaxreturnsoftware.POINTS:1DIFFICULTY:ModerateQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-02-LO:1-02NATIONALSTANDARDS:UnitedStates-BUSPROG:Technology:Technology:-BUSPROG:TechnologySTATESTANDARDS:UnitedStates-AK-AICPA:FN-ReportingKEYWORDS:Bloom's:KnowledgeOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM
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South-Western Federal Taxation 2018: Comprehensive 41st Edition Test Bank - Page 2 preview image
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South-Western Federal Taxation 2018: Comprehensive 41st Edition Test Bank - Page 3 preview image3.TheratificationoftheSixteenthAmendmenttotheU.S.ConstitutionwasnecessarytovalidatetheFederalincometaxoncorporations.a.Trueb.FalseANSWER:FalseRATIONALE:TheSixteenthAmendmentvalidatedonlythetaxonindividuals.Theincometaxoncorporationshadbeenpreviouslysanctionedbythecourts.POINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-02-LO:1-02NATIONALSTANDARDS:UnitedStates-BUSPROG:Technology:Technology:-BUSPROG:TechnologySTATESTANDARDS:UnitedStates-AK-AICPA:FN-ResearchKEYWORDS:Bloom's:KnowledgeOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM4.BeforetheSixteenthAmendmenttotheConstitutionwasratified,therewasnovalidFederalincometaxonindividuals.a.Trueb.FalseANSWER:FalseRATIONALE:ThereexistedaFederalincometaxduringtheCivilWarthatwassanctionedbytheU.S.SupremeCourt.POINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-02-LO:1-02NATIONALSTANDARDS:UnitedStates-BUSPROG:Technology:Technology:-BUSPROG:TechnologySTATESTANDARDS:UnitedStates-AK-AICPA:FN-ResearchKEYWORDS:Bloom's:KnowledgeOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM
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South-Western Federal Taxation 2018: Comprehensive 41st Edition Test Bank - Page 4 preview image5.Thefirstincometaxonindividuals(aftertheratificationoftheSixteenthAmendmenttotheConstitution)leviedtaxratesfromalowof2%toahighof6%.a.Trueb.FalseANSWER:TruePOINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-02-LO:1-02NATIONALSTANDARDS:UnitedStates-BUSPROG:Technology:Technology:-BUSPROG:TechnologySTATESTANDARDS:UnitedStates-AK-AICPA:FN-ResearchKEYWORDS:Bloom's:KnowledgeOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM6.Thepay-as-you-gofeatureoftheFederalincometaxonindividualsconformstoAdamSmith’scanon(principle)ofcertainty.a.Trueb.FalseANSWER:FalseRATIONALE:Pay-as-you-goreferstothewithholdingprovisionsapplicabletowagesandothertypesofincomeandaddsconveniencetothetaxsystem.POINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-03-LO:1-03NATIONALSTANDARDS:UnitedStates-BUSPROG:Technology:Technology:-BUSPROG:TechnologySTATESTANDARDS:UnitedStates-AK-AICPA:FN-ReportingKEYWORDS:Bloom's:ComprehensionOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM
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South-Western Federal Taxation 2018: Comprehensive 41st Edition Test Bank - Page 5 preview image7.TheFICAtax(Medicarecomponent)onwagesisprogressivesincethetaxdueincreasesaswagesincrease.a.Trueb.FalseANSWER:FalseRATIONALE:TheFICAtax(Medicarecomponent)isproportionalbecausetherateisconstantregardlessofthewagesearned.POINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-03-LO:1-03NATIONALSTANDARDS:UnitedStates-BUSPORG:Comprehension-BUSPORG:ComprehensionSTATESTANDARDS:UnitedStates-AK-AICPA:FN-Measurement-AICPA:FN-MeasurementKEYWORDS:Bloom's:ComprehensionOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM8.TheFederalestateandgifttaxesareexamplesofprogressivetaxes.a.Trueb.FalseANSWER:TruePOINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-03-LO:1-03NATIONALSTANDARDS:UnitedStates-BUSPORG:Comprehension-BUSPORG:ComprehensionSTATESTANDARDS:UnitedStates-AK-AICPA:FN-Measurement-AICPA:FN-MeasurementKEYWORDS:Bloom's:ComprehensionOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM
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South-Western Federal Taxation 2018: Comprehensive 41st Edition Test Bank - Page 6 preview image9.TheFederalexcisetaxoncigarettesisanexampleofaproportionaltax.a.Trueb.FalseANSWER:TrueRATIONALE:Thetaxisaflat$1.01perpack.POINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-03-LO:1-03NATIONALSTANDARDS:UnitedStates-BUSPORG:Comprehension-BUSPORG:ComprehensionSTATESTANDARDS:UnitedStates-AK-AICPA:FN-Measurement-AICPA:FN-MeasurementKEYWORDS:Bloom's:ComprehensionOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM10.Currently,theFederalincometaxislessprogressivethaniteverhasbeeninthepast.a.Trueb.FalseANSWER:FalseRATIONALE:Currently,theFederalincometaxhassixrates.Atonetime,ithadtworates.POINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-03-LO:1-03NATIONALSTANDARDS:UnitedStates-BUSPORG:Comprehension-BUSPORG:ComprehensionSTATESTANDARDS:UnitedStates-AK-AICPA:FN-Measurement-AICPA:FN-MeasurementKEYWORDS:Bloom's:ComprehensionOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM
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South-Western Federal Taxation 2018: Comprehensive 41st Edition Test Bank - Page 7 preview image11.Monainheritshermother’spersonalresidence,whichsheconvertstoafurnishedrentalhouse.Thesechangesshouldaffecttheamountofadvalorempropertytaxesleviedontheproperties.a.Trueb.FalseANSWER:TrueRATIONALE:Conversionfromresidentialtorentalusewillincreasethetaxes.Furthermore,Mona’smothermayhavehadaseniorcitizenexemptionontheproperty,whichwillnolongerbeappropriate.Lastly,thefurnishingsintherenthousecouldnowbesubjecttoanadvaloremtaxonpersonalty.POINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-04-LO:1-04NATIONALSTANDARDS:UnitedStates-BUSPORG:Comprehension-BUSPORG:ComprehensionSTATESTANDARDS:UnitedStates-AK-AICPA:FN-Measurement-AICPA:FN-MeasurementKEYWORDS:Bloom's:ComprehensionOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM12.Afixturewillbesubjecttotheadvaloremtaxonpersonaltyratherthantheadvaloremtaxonrealty.a.Trueb.FalseANSWER:FalseRATIONALE:Bydefinition,afixturebecomespartoftherealestatetowhichitisattached.POINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-04-LO:1-04NATIONALSTANDARDS:UnitedStates-BUSPORG:Comprehension-BUSPORG:ComprehensionSTATESTANDARDS:UnitedStates-AK-AICPA:FN-Measurement-AICPA:FN-MeasurementKEYWORDS:Bloom's:ComprehensionOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM
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South-Western Federal Taxation 2018: Comprehensive 41st Edition Test Bank - Page 8 preview image13.Evenifpropertytaxratesarenotchanged,theamountofadvaloremtaxesimposedonrealtymaynotremainthesame.a.Trueb.FalseANSWER:TrueRATIONALE:Propertytaxeswillvaryinaccordancewithchangesintheassessedvalueoftheproperty.POINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-04-LO:1-04NATIONALSTANDARDS:UnitedStates-BUSPORG:Comprehension-BUSPORG:ComprehensionSTATESTANDARDS:UnitedStates-AK-AICPA:FN-Measurement-AICPA:FN-MeasurementKEYWORDS:Bloom's:ComprehensionOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM14.Theadvaloremtaxonpersonalusepersonaltyismoreoftenavoidedbytaxpayersthantheadvaloremtaxonbusinessusepersonalty.a.Trueb.FalseANSWER:TruePOINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-04-LO:1-04NATIONALSTANDARDS:UnitedStates-BUSPROG:Technology:Technology:-BUSPROG:TechnologySTATESTANDARDS:UnitedStates-AK-AICPA:FN-ReportingKEYWORDS:Bloom's:ComprehensionOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM
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South-Western Federal Taxation 2018: Comprehensive 41st Edition Test Bank - Page 9 preview image15.AFederalexcisetaxisnolongerimposedonadmissiontotheaters.a.Trueb.FalseANSWER:TrueRATIONALE:Suchtaxhasbeenrescinded.POINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-04-LO:1-04NATIONALSTANDARDS:UnitedStates-BUSPORG:Comprehension-BUSPORG:ComprehensionSTATESTANDARDS:UnitedStates-AK-AICPA:FN-Measurement-AICPA:FN-MeasurementKEYWORDS:Bloom's:KnowledgeOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM16.ThereisaFederalexcisetaxonhoteloccupancy.a.Trueb.FalseANSWER:FalsePOINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-04-LO:1-04NATIONALSTANDARDS:UnitedStates-BUSPORG:Comprehension-BUSPORG:ComprehensionSTATESTANDARDS:UnitedStates-AK-AICPA:FN-Measurement-AICPA:FN-MeasurementKEYWORDS:Bloom's:KnowledgeOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM
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South-Western Federal Taxation 2018: Comprehensive 41st Edition Test Bank - Page 10 preview image17.TheFederalgas-guzzlertaxappliesonlytoautomobilesmanufacturedoverseasandimportedintotheU.S.a.Trueb.FalseANSWER:FalseRATIONALE:Nosuchrestrictionisimposed.AlthoughmanyoftheEuropeanluxuryandsportscarmanufacturerswereinitiallyhithardbythetax,thelawissilentonthismatter.POINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-04-LO:1-04NATIONALSTANDARDS:UnitedStates-BUSPORG:Comprehension-BUSPORG:ComprehensionSTATESTANDARDS:UnitedStates-AK-AICPA:FN-Measurement-AICPA:FN-MeasurementKEYWORDS:Bloom's:KnowledgeOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM18.LiketheFederalcounterpart,theamountofthestateexcisetaxesongasolinevariesfromstatetostate.a.Trueb.FalseANSWER:FalseRATIONALE:TheFederalexcisetaxrateongasolineremainsconstant.POINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-04-LO:1-04NATIONALSTANDARDS:UnitedStates-BUSPORG:Comprehension-BUSPORG:ComprehensionSTATESTANDARDS:UnitedStates-AK-AICPA:FN-Measurement-AICPA:FN-MeasurementKEYWORDS:Bloom's:KnowledgeOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM
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South-Western Federal Taxation 2018: Comprehensive 41st Edition Test Bank - Page 11 preview image19.Notallofthestatesthatimposeageneralsalestaxalsohaveausetax.a.Trueb.FalseANSWER:FalseRATIONALE:Everystatethathasageneralsalestaxalsohasausetax.Therearenostateswithonlyasalesorusetax.POINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-04-LO:1-04NATIONALSTANDARDS:UnitedStates-BUSPORG:Comprehension-BUSPORG:ComprehensionSTATESTANDARDS:UnitedStates-AK-AICPA:FN-Measurement-AICPA:FN-MeasurementKEYWORDS:Bloom's:KnowledgeOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM20.Salesmadebymailorderarenotexemptfromtheapplicationofageneralsales(oruse)tax.a.Trueb.FalseANSWER:TrueRATIONALE:Theyarenotexemptbutcomplianceissporadic.POINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-04-LO:1-04NATIONALSTANDARDS:UnitedStates-BUSPORG:Comprehension-BUSPORG:ComprehensionSTATESTANDARDS:UnitedStates-AK-AICPA:FN-Measurement-AICPA:FN-MeasurementKEYWORDS:Bloom's:KnowledgeOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM
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South-Western Federal Taxation 2018: Comprehensive 41st Edition Test Bank - Page 12 preview image21.Twopersonswholiveinthesamestatebutindifferentcountiesmaynotbesubjecttothesamegeneralsalestaxrate.a.Trueb.FalseANSWER:TrueRATIONALE:Thispossibilitycouldexistiflocaljurisdictionsexactadditionalsalestaxes.POINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-04-LO:1-04NATIONALSTANDARDS:UnitedStates-BUSPORG:Comprehension-BUSPORG:ComprehensionSTATESTANDARDS:UnitedStates-AK-AICPA:FN-Measurement-AICPA:FN-MeasurementKEYWORDS:Bloom's:KnowledgeOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM22.Statesimposeeitherastateincometaxorageneralsalestax,butnotbothtypesoftaxes.a.Trueb.FalseANSWER:FalseRATIONALE:Manystatesimposeboth.POINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-04-LO:1-04NATIONALSTANDARDS:UnitedStates-BUSPORG:Comprehension-BUSPORG:ComprehensionSTATESTANDARDS:UnitedStates-AK-AICPA:FN-Measurement-AICPA:FN-MeasurementKEYWORDS:Bloom's:KnowledgeOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM
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South-Western Federal Taxation 2018: Comprehensive 41st Edition Test Bank - Page 13 preview image23.Asafeandeasywayforataxpayertoavoidlocalandstatesalestaxesistomakethepurchaseinastatethatleviesnosuchtaxes.a.Trueb.FalseANSWER:FalseRATIONALE:AreviewoftheExample5discussionshowsthatthismaynotalwaysbesuccessful.POINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-04-LO:1-04NATIONALSTANDARDS:UnitedStates-BUSPORG:Comprehension-BUSPORG:ComprehensionSTATESTANDARDS:UnitedStates-AK-AICPA:FN-Measurement-AICPA:FN-MeasurementKEYWORDS:Bloom's:ComprehensionOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM24.Ontransfersbydeath,theFederalgovernmentreliesonanestatetax,whilestatesimposeanestatetax,aninheritancetax,bothtaxes,orneithertax.a.Trueb.FalseANSWER:TrueRATIONALE:TheFederalgovernmentreliesonanestatetaxwhilestatesimposeanestatetax,aninheritancetax,bothtaxes,orneithertax.POINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-04-LO:1-04NATIONALSTANDARDS:UnitedStates-BUSPORG:Comprehension-BUSPORG:ComprehensionSTATESTANDARDS:UnitedStates-AK-AICPA:FN-Measurement-AICPA:FN-MeasurementKEYWORDS:Bloom's:KnowledgeOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM
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South-Western Federal Taxation 2018: Comprehensive 41st Edition Test Bank - Page 14 preview image25.Aninheritancetaxisataxonadecedent’srighttopasspropertyatdeath.a.Trueb.FalseANSWER:FalseRATIONALE:Whatisdescribedisanestatetax.Aninheritancetaxisataxonanheir’srighttoreceivepropertyfromadecedent.POINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-04-LO:1-04NATIONALSTANDARDS:UnitedStates-BUSPORG:Comprehension-BUSPORG:ComprehensionSTATESTANDARDS:UnitedStates-AK-AICPA:FN-Measurement-AICPA:FN-MeasurementKEYWORDS:Bloom's:KnowledgeOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM26.OneofthemajorreasonsfortheenactmentoftheFederalestatetaxwastopreventlargeamountsofwealthfrombeingaccumulatedwithinthefamilyunit.a.Trueb.FalseANSWER:TruePOINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-04-LO:1-04NATIONALSTANDARDS:UnitedStates-BUSPROG:Technology:Technology:-BUSPROG:TechnologySTATESTANDARDS:UnitedStates-AK-AICPA:FN-Measurement-AICPA:FN-MeasurementKEYWORDS:Bloom's:KnowledgeOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM
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South-Western Federal Taxation 2018: Comprehensive 41st Edition Test Bank - Page 15 preview image27.UnderClint’swill,allofhispropertypassestoeithertheLutheranChurchortohiswife.NoFederalestatetaxwillbedueonClint’sdeathin2017.a.Trueb.FalseANSWER:TrueRATIONALE:AcombinationofthecharitableandmaritaldeductionswilleliminateClint’staxableestate.POINTS:1DIFFICULTY:ModerateQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-04-LO:1-04NATIONALSTANDARDS:UnitedStates-BUSPORG:Comprehension-BUSPORG:ComprehensionSTATESTANDARDS:UnitedStates-AK-AICPA:FN-Measurement-AICPA:FN-MeasurementKEYWORDS:Bloom's:ComprehensionOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM28.Undertheusualstateinheritancetax,twoheirs,acousinandasonofthedeceased,wouldnotbetaxedatthesamerate.a.Trueb.FalseANSWER:TrueRATIONALE:Themorecloselyrelatedtheheiristothedecedent,thelargertheexemptionallowedand/orthelowerthetaxrateimposed.POINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-04-LO:1-04NATIONALSTANDARDS:UnitedStates-BUSPORG:Comprehension-BUSPORG:ComprehensionSTATESTANDARDS:UnitedStates-AK-AICPA:FN-Measurement-AICPA:FN-MeasurementKEYWORDS:Bloom's:ComprehensionOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM
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South-Western Federal Taxation 2018: Comprehensive 41st Edition Test Bank - Page 16 preview image29.Theannualexclusion,currently$14,000,isavailableforgiftandestatetaxpurposes.a.Trueb.FalseANSWER:FalseRATIONALE:Theannualexclusionisnotavailableforestatetaxpurposes.POINTS:1DIFFICULTY:EasyQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-04-LO:1-04NATIONALSTANDARDS:UnitedStates-BUSPORG:Comprehension-BUSPORG:ComprehensionSTATESTANDARDS:UnitedStates-AK-AICPA:FN-Measurement-AICPA:FN-MeasurementKEYWORDS:Bloom's:KnowledgeOTHER:Time:2min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM30.In2017,José,awidower,sellsland(fairmarketvalueof$100,000)tohisdaughter,Linda,for$50,000.Joséhasnotmadeataxablegift.a.Trueb.FalseANSWER:FalseRATIONALE:$100,000(valueofland)–$50,000(considerationreceived)–$14,000(perdoneeannualexclusion)=$36,000(taxablegift).POINTS:1DIFFICULTY:ModerateQUESTIONTYPE:True/FalseHASVARIABLES:FalseLEARNINGOBJECTIVES:CMPV.SWFT.LO:1-04-LO:1-04NATIONALSTANDARDS:UnitedStates-BUSPORG:Comprehension-BUSPORG:ComprehensionSTATESTANDARDS:UnitedStates-AK-AICPA:FN-Measurement-AICPA:FN-MeasurementKEYWORDS:Bloom's:ComprehensionOTHER:Time:5min.DATECREATED:11/28/20163:10PMDATEMODIFIED:5/11/201712:50PM
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