1040 Quiz

1040 Part 6 Exam 84%

Wednesday, August 03, 2011 9:52 AM

1.All of the following are requirements for filing Schedule C-EZ except: 1. 2. 3. 4. Business expenses not exceeding $5,000 Gross receipts under $100,000 No home office deduction No employees

2.Which of the following is not correct with regard to vacation homes? 1. Where annual rental is fewer than 15 days, rental income is not reported, and no deductions are allowed (other than mortgage interest and taxes). 2. Where annual rental is 15 days or longer and personal use exceeds the lengthier of 14 days or 10% of the rental period, deductions and expenses are limited to rental income. 3. Where annual rental is 15 days or longer and personal use does not exceed 14 days or 10% of the rental period, property is treated as rental property subject to the passive loss limitations. 4. Mortgage interest and property taxes are not deductible if expenses exceed rental income. 3.What characteristic is not required for an accountable plan? 1. 2. 3. 4. 1. 2. 3. 4. The employee must provide adequate substantiation of all expenses on a timely basis. The purpose of the expense must be defined at the time of payment. The plan must require remittance of any advances or payments in excess of substantiated expenses. Substantiation and remittance of excess amounts must be made on a timely basis. Advances be made within 30 days of expense Substantiation be provided to the employer within 60 days of expense Excess amounts be returned within 120 days of expense All of the above.

4.Accountable plans require that:

5.Which of the following is not deductible as an “actual car expense” by a taxpayer who uses that method to figure the deductible cost of operating his car for business purposes? 1. 2. 3. 4. Gas and oil Depreciation Parking fines Lease fees transportation between an individual’s office and his client’s place of business transportation between an individual’s home and a temporary training site in the same...