37. Which of the following is not a goal of the tax law?
a.
Encouraging certain social goals such as contributions to charity.
b.
Encouraging certain economic goals such as a thriving business community.
c.
Encouraging smaller families.
d.
Raising revenue to operate the government.
e.
None of these are goals of the tax law.
ANSWER:
c
38. Which one of the following provisions was passed by Congress to meet a social goal of the tax law?
a.
The deduction for job hunting expenses.
b.
The charitable deduction.
c.
The moving expense deduction for adjusted gross income.
d.
The deduction for soil and water conservation costs available to farmers.
e.
None of these.
ANSWER:
b
39. Which of the following is not a goal of the tax law?
a.
Ensuring that all persons pay the same amount of tax.
b.
Economic goals such as reduction in unemployment.
c.
Social goals such as lowering the cost of adoption.
d.
Raise adequate revenue to operate the government.
ANSWER:
a
40. In 2020, Wesley has a fairly simple tax situation with moderate wage income and a modest amount of interest income. Wesley, age 45, wishes to use the easiest possible tax form. He may file:
a.
Form 1040EZ
b.
Form 1040A
c.
Form 1040
d.
Form 1065
e.
None of these
ANSWER:
c
41. Which of the following forms may be filed by individual taxpayers?
a.
Form 1040
b.
Form 1041
c.
Form 1065
d.
Form 1120
e.
None of these
ANSWER:
a
42. Partnerships:
a.
Are not taxable entities.
b.
Are taxed in the same manner as individuals.
c.
File tax returns on Form 1120.
d.
File tax returns on Form 1041.
ANSWER:
a
43. Which of the following is correct?
a.
An individual is a reporting entity but not a taxable entity.
b.
A partnership is a taxable entity and a reporting entity.
c.
A corporation is a reporting entity but not a taxable entity.
d.
A partnership is a reporting entity but not a taxable entity.
ANSWER:
d
44. In 2020, Schedule 1 of Form 1040 is used to report:
a.
Salary income.
b.
Capital gains and losses.
c.
Withholding on wages.
d.
Unemployment compensation.
ANSWER:
d
45. Partnership income is reported on:
a.
Form 1040PTR.
b.
Form 1120S.
c.
Form 1040X.
d.
Form 1065.
ANSWER:
d
46. In 2020, depending on the amounts of income and other tax information, some individuals may report their income on:
a.
Form 1040A.
b.
Form 1065.
c.
Form 1120.
d.
Form 1041.
e.
None of these.
ANSWER:
e
47. Which of the following is not considered one of the five basic taxable or reporting entities?
a.
Partnership
b.
Corporation
c.
Portfolio
d.
Individual
e.
Trust
ANSWER:
c
48. Eugene and Velma are married. For 2020, Eugene earned $25,000 and Velma earned $30,000. They have decided to file separate returns. They have no deductions for adjusted gross income. Velma's itemized deductions are $14,200 so she is going to itemize. Eugene's itemized deductions are $4,000. Assuming Eugene and Velma do not live in a community property state, what is Eugene's taxable income?