South-Western Federal Taxation 2022: Individual Income Taxes 45th edition by James C. Young Test ban
True / False
1. Because the law is complicated, most individual taxpayers are not able to complete their Federal income tax returns without outside assistance.
a. True
b. False
ANSWER: True
2. The ratification of the Sixteenth Amendment to the U.S. Constitution was necessary to validate the Federal income tax on corporations.
a. True
b. False
ANSWER: False
3. Before the Sixteenth Amendment to the Constitution was ratified, there was no valid Federal income tax on individuals.
a. True
b. False
ANSWER: False
4. The first income tax on individuals (after the ratification of the Sixteenth Amendment to the Constitution) levied tax rates from a low of 1% to a high of 6%.
a. True
b. False
ANSWER: True
5. The Federal income tax on individuals generates more revenue than the Federal income tax on corporations.
a. True
b. False
ANSWER: True
6. The pay-as-you-go feature of the Federal income tax on individuals conforms to Adam Smith’s canon (principle) of certainty.
a. True
b. False
ANSWER: False
7. The Medicare component of the FICA tax (1.45% on wages) is progressive since the tax due increases as wages increase.
a. True
b. False
ANSWER: False
8. The Federal estate and gift taxes are examples of progressive rate taxes.
a. True
b. False
ANSWER: True
9. The Federal excise tax on gasoline has a proportional effect on all taxpayers (that is, neither progressive or regressive).
a. True
b. False
ANSWER: False
10. Currently, the Federal corporate income tax is less progressive than the individual income tax.
a. True
b. False
ANSWER: True
11. Mona inherits her mother’s personal residence, which she converts to a furnished rental house. These changes should affect the amount of ad valorem property taxes levied on the properties.
a. True
b. False
ANSWER: True
12. A fixture will be subject to the ad valorem tax on personalty rather than the ad valorem tax on realty.
a. True
b. False
ANSWER: False
13. Even if property tax rates are not changed, the amount of ad valorem taxes imposed on realty may not remain the same.
a. True
b. False
ANSWER: True
14. The ad valorem tax on personal use personalty is more often avoided by taxpayers than the ad valorem tax on business use personalty.
a. True
b. False
ANSWER: True
15. An excise tax is often used to try to influence behavior.
a. True
b. False
ANSWER: True
16. There is a Federal excise tax on hotel occupancy.
a. True
b. False
ANSWER: False
17. The Federal gas-guzzler tax applies only to automobiles manufactured overseas and imported into the United States.
a. True
b. False
ANSWER: False
18. The amount of the state excise taxes on gasoline varies from state to state.
a. True
b. False
ANSWER: True
19. Not all of the states that impose a general sales tax also have a use tax.
a. True
b. False
ANSWER: False
20. Sales made over the internet are not exempt from the application of a general sales (or use) tax.
a. True
b. False
ANSWER: True
21. Two persons who live in the same state but in different counties may not be subject to the same general sales tax rate.
a. True
b. False
ANSWER: True
22. States impose either a state income tax or a general sales tax, but not both types of taxes.
a. True
b. False
ANSWER: False
1. Because the law is complicated, most individual taxpayers are not able to complete their Federal income tax returns without outside assistance.
a. True
b. False
ANSWER: True
2. The ratification of the Sixteenth Amendment to the U.S. Constitution was necessary to validate the Federal income tax on corporations.
a. True
b. False
ANSWER: False
3. Before the Sixteenth Amendment to the Constitution was ratified, there was no valid Federal income tax on individuals.
a. True
b. False
ANSWER: False
4. The first income tax on individuals (after the ratification of the Sixteenth Amendment to the Constitution) levied tax rates from a low of 1% to a high of 6%.
a. True
b. False
ANSWER: True
5. The Federal income tax on individuals generates more revenue than the Federal income tax on corporations.
a. True
b. False
ANSWER: True
6. The pay-as-you-go feature of the Federal income tax on individuals conforms to Adam Smith’s canon (principle) of certainty.
a. True
b. False
ANSWER: False
7. The Medicare component of the FICA tax (1.45% on wages) is progressive since the tax due increases as wages increase.
a. True
b. False
ANSWER: False
8. The Federal estate and gift taxes are examples of progressive rate taxes.
a. True
b. False
ANSWER: True
9. The Federal excise tax on gasoline has a proportional effect on all taxpayers (that is, neither progressive or regressive).
a. True
b. False
ANSWER: False
10. Currently, the Federal corporate income tax is less progressive than the individual income tax.
a. True
b. False
ANSWER: True
11. Mona inherits her mother’s personal residence, which she converts to a furnished rental house. These changes should affect the amount of ad valorem property taxes levied on the properties.
a. True
b. False
ANSWER: True
12. A fixture will be subject to the ad valorem tax on personalty rather than the ad valorem tax on realty.
a. True
b. False
ANSWER: False
13. Even if property tax rates are not changed, the amount of ad valorem taxes imposed on realty may not remain the same.
a. True
b. False
ANSWER: True
14. The ad valorem tax on personal use personalty is more often avoided by taxpayers than the ad valorem tax on business use personalty.
a. True
b. False
ANSWER: True
15. An excise tax is often used to try to influence behavior.
a. True
b. False
ANSWER: True
16. There is a Federal excise tax on hotel occupancy.
a. True
b. False
ANSWER: False
17. The Federal gas-guzzler tax applies only to automobiles manufactured overseas and imported into the United States.
a. True
b. False
ANSWER: False
18. The amount of the state excise taxes on gasoline varies from state to state.
a. True
b. False
ANSWER: True
19. Not all of the states that impose a general sales tax also have a use tax.
a. True
b. False
ANSWER: False
20. Sales made over the internet are not exempt from the application of a general sales (or use) tax.
a. True
b. False
ANSWER: True
21. Two persons who live in the same state but in different counties may not be subject to the same general sales tax rate.
a. True
b. False
ANSWER: True
22. States impose either a state income tax or a general sales tax, but not both types of taxes.
a. True
b. False
ANSWER: False