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Study sets matching "tax chapter 14"

23 terms
Tax Chapter 14
filing status
joint return
joint and several liability
surviving spouse
reflects an individual's marital and family situation and aff…
reflects the combined activities of both spouses for the enti…
each spouse is responsible for paying the entire tax (not jus…
if the widow or widower maintains a home for a dependent chil…
filing status
reflects an individual's marital and family situation and aff…
joint return
reflects the combined activities of both spouses for the enti…
26 terms
Tax Chapter 14
filing status
joint return
joint and several liability
surviving spouse
Reflects an individual's martial and family situation, affect…
An individual who is married on the last day of the taxable y…
A husband and wife who file a joint return have _____________…
If the widow or widower maintains a home for a dependent chil…
filing status
Reflects an individual's martial and family situation, affect…
joint return
An individual who is married on the last day of the taxable y…
43 terms
Tax Final Flashcards: Chapter 14
Dwelling unit for tax purposes
For a dwelling unit to be considered a…
Is residence "principal residence?"
Personal use days:
House... Condo... Mobile home... Boat... Other similar property
Taxpayers personal use days of the home must be MORE than the…
Subjective determination based on:... -amount of time taxpayer…
~Taxpayer or any owner of home stays in the home... ~A relative…
Dwelling unit for tax purposes
House... Condo... Mobile home... Boat... Other similar property
For a dwelling unit to be considered a…
Taxpayers personal use days of the home must be MORE than the…
19 terms
Tax-Chapter 14
Acquisition Indebtedness
Active Participant in a Rental Activity
Dwelling Unit
Escrow Account
Debt secured by a qualified residence that is incurred in acq…
An individual who owns at least 10% of a rental property and…
Property that provides a place suitable for people to occupy
A holding account with a taxpayers mortgage lender.
Acquisition Indebtedness
Debt secured by a qualified residence that is incurred in acq…
Active Participant in a Rental Activity
An individual who owns at least 10% of a rental property and…
37 terms
Tax Chapter 14
What is the AMT? What is its purpose?
AMT formula
Tax base formula
AMT Tax Rates
Ensures taxpayers pay a "fair" share of taxes irrespective of…
Tax Base x AMT Tax Rate= Tentative Minimum Tax - Regular Inco…
Regular taxable income/loss + tax preference items +/- AMT ad…
2015 Rates ... 26% on first $185,400.... 28% on AMTI over $185,400.
What is the AMT? What is its purpose?
Ensures taxpayers pay a "fair" share of taxes irrespective of…
AMT formula
Tax Base x AMT Tax Rate= Tentative Minimum Tax - Regular Inco…
tax chapter 14- the individual tax formula
filing status
joint return
surviving spouse
head of household
reflects marital and family situation, affects the calculatio…
reflects combined activities of both spouses for the whole ye…
if the widow or widower maintains a home for a dependent chil…
unmarried on the last day of the year, who is not a surviving…
filing status
reflects marital and family situation, affects the calculatio…
joint return
reflects combined activities of both spouses for the whole ye…
16 terms
Tax Chapter 14
Tax
Essential Characteristics of Taxes
Personal Tax
Property Tax
Fee which is a percentage of income, property valve or transa…
1.) Obligatory 2.) Monetary 3.) Proportionate 4.) Imposed on…
Fixed amount imposed on individuals residing within a specifi…
Paid based on the value of the property to be levied(171)
Tax
Fee which is a percentage of income, property valve or transa…
Essential Characteristics of Taxes
1.) Obligatory 2.) Monetary 3.) Proportionate 4.) Imposed on…
34 terms
Tax Chapter 14
TI+AMT preference items+-AMT Adjustmen…
Whichever is greater
miscellaneous itemized deductions, sta…
standard deduction, personal exemptions
What is the calculation for AMT?
Do you pay regular tax liability or AMT?
What are the AMT adjustments for itemized deductions
other than itemized deductions what are the AMT adjustments w…
TI+AMT preference items+-AMT Adjustmen…
What is the calculation for AMT?
Whichever is greater
Do you pay regular tax liability or AMT?
24 terms
Tax Chapter 14
above-the-line deduction
adjusted gross income (AGI)
bunching
child credit
an allowable deduction for an individual taxpayer that can be…
total income less adjustments as computed on page 1, Form 104…
a tax planning technique to concentrate itemized deductions i…
a credit based on the number of the taxpayer's dependent chil…
above-the-line deduction
an allowable deduction for an individual taxpayer that can be…
adjusted gross income (AGI)
total income less adjustments as computed on page 1, Form 104…
44 terms
Tax Chapter 14
Types of Filing Status (5)... From best t…
How long can you file as surviving spo…
MFJ rates (2)
Taxable Income
Married Filing Joint... Surviving Spouse... Married Filing Separate…
For two years after spouse dies
If incomes are similar, single rates generate lower overall t…
Total income - for AGI deductions = AGI... AGI - greater of stan…
Types of Filing Status (5)... From best t…
Married Filing Joint... Surviving Spouse... Married Filing Separate…
How long can you file as surviving spo…
For two years after spouse dies
51 terms
Tax Chapter 14 Tax Practice and Administration
What are the purpose of penalties?
What are the two types of penalties?
Ad Valorem penalties
Assessable Penalties
1. Increases voluntary compliance... 2. Increases taxpayer's cos…
Ad Valorem penalties and Assessable penalties
-Percentage of the Delinquent Tax... -As the underpayment increa…
Flat Dollar Amount
What are the purpose of penalties?
1. Increases voluntary compliance... 2. Increases taxpayer's cos…
What are the two types of penalties?
Ad Valorem penalties and Assessable penalties
34 terms
Tax: Chapter 14 Part 1
payroll tax
Federal Insurance Contributions Act
old age, survivors and disability insu…
witholding
self employment tax aka
FICA
FICA includes
employees and employers split FICA taxes through...
payroll tax
self employment tax aka
Federal Insurance Contributions Act
FICA
69 terms
Chapter 14 Personal Income Tax
1. A personal residence is not a capit…
2. A taxpayer may be required to pay t…
3. When determining the number of days…
4. Taxpayers meeting certain requireme…
FALSE
TRUE - Gain in excess of the excludable amount qualifies as l…
FALSE - Days when a home is available for rent but not actual…
TRUE
1. A personal residence is not a capit…
FALSE
2. A taxpayer may be required to pay t…
TRUE - Gain in excess of the excludable amount qualifies as l…
63 terms
Chapter 14 Tax
Samantha died on January 18, 2012. Her…
Leon died on August 23, 2011, and his…
Mr. Jones and his first wife were lega…
Which of the following statements rega…
B. Married filing jointly in 2012; single in 2013.
B. Surviving spouse for 2012 and 2013; head of household for…
A. Married filing jointly with the second Mrs. Jones
C. Any unmarried individual with a dependent child qualifies…
Samantha died on January 18, 2012. Her…
B. Married filing jointly in 2012; single in 2013.
Leon died on August 23, 2011, and his…
B. Surviving spouse for 2012 and 2013; head of household for…
11 terms
Tax Chapter 14
Net capital loss deduction limit for a…
Why are capital gains/losses separated…
Proper classification of gains and los…
Capital assets
$3,000
Long-term capital gains may be taxed at a lower rate than ord…
Tax status of property (capital asset, 1231 asset, ordinary a…
Everything except inventory (stock in trade), notes and accou…
Net capital loss deduction limit for a…
$3,000
Why are capital gains/losses separated…
Long-term capital gains may be taxed at a lower rate than ord…
26 terms
Chapter 14 Tax
How do you compute the self employment…
Do partners recognize gains or losses…
What is an outside basis?
What is inside basis?
Ordinary Income... + Garunteed payments... - 1231 gains included in…
generally no
basis of the partnership interest in the hands of the partner.
The partners share of the basis of the individual assets in t…
How do you compute the self employment…
Ordinary Income... + Garunteed payments... - 1231 gains included in…
Do partners recognize gains or losses…
generally no
19 terms
Chapter 14 - The Individual Tax Formula
filing status
joint return
joint and several liability
surviving spouse**
reflects marital/family situation
filing with spouse
each spouse is responsible for paying the entire tax, not jus…
if a widow maintains a home for a dependent child, then they…
filing status
reflects marital/family situation
joint return
filing with spouse
11 terms
Sales Tax Chapter 14
Retailer
Wholesaler
Merchandise
Sales
A business that sells to the final user, the consumer
A business that sells to the retailers
Goods bought to resell to customers
A revenue account to record the amount of the merchandise sold
Retailer
A business that sells to the final user, the consumer
Wholesaler
A business that sells to the retailers
10 terms
Tax Acct Chapter 14
Factors in Determination of Gain
Gain
Fair Market Value
Gift Rule
1. Gain... 2. Cost as basis... 3. Fair Market Value... 4. Adjustments…
Amt realized - adjusted base
What a willing buyer will pay a willing seller in an arms len…
You cant transfer a loss
Factors in Determination of Gain
1. Gain... 2. Cost as basis... 3. Fair Market Value... 4. Adjustments…
Gain
Amt realized - adjusted base
10 terms
Chapter 14 - Income Tax
Income tax appears on IS as/BS as
Estimates of income tax must be made d…
An ______ ______ at the end of the per…
Interperiod Tax Allocation: dividing
expense/payable to gov
fiscal period
adjusting entry/reconcile/estimated
tax expenses between amounts due soon and amounts due in the…
Income tax appears on IS as/BS as
expense/payable to gov
Estimates of income tax must be made d…
fiscal period
69 terms
Chapter 14 Personal Income Tax
1. A personal residence is not a capit…
2. A taxpayer may be required to pay t…
3. When determining the number of days…
4. Taxpayers meeting certain requireme…
FALSE
TRUE - Gain in excess of the excludable amount qualifies as l…
FALSE - Days when a home is available for rent but not actual…
TRUE
1. A personal residence is not a capit…
FALSE
2. A taxpayer may be required to pay t…
TRUE - Gain in excess of the excludable amount qualifies as l…
34 terms
Taxes Terms (Chapter 14)
tax
revenue
tax base
individual income tax
required payment to government
government's income
income, good, etc. subject to tax
tax on one's income
tax
required payment to government
revenue
government's income
11 terms
Chapter 14: Home Ownership tax
Personal residence
Qualified mortgage interest deduction:
Property tax deduction
Exclusion of gains on sale of residenc…
a) must be de classified as a " Dwelling", where suitable for…
a) acquisition indebtedness up to $1,000,0000 secured by home…
a) deducted in year taxes are Paid... b) may be pro-rated betwee…
Ownership and use test... 1) taxpayer must have owned and used t…
Personal residence
a) must be de classified as a " Dwelling", where suitable for…
Qualified mortgage interest deduction:
a) acquisition indebtedness up to $1,000,0000 secured by home…
7 terms
tax chapter 14 notes
-gain(loss)= amt taxpayer receives fro…
Exceptions for non qualified use and h…
Interest expense on home-related debt…
Real property taxes... -applies to homes,…
Ownership test: owned property for total of 2 or more years d…
Exclusion of gain from debt forgiveness on foreclosure of hom…
limitations of home-related debt... -a limitation on the amt of…
...
-gain(loss)= amt taxpayer receives fro…
Ownership test: owned property for total of 2 or more years d…
Exceptions for non qualified use and h…
Exclusion of gain from debt forgiveness on foreclosure of hom…
26 terms
Economics Chapter 14: Taxes
tax
revenue
income tax
sales tax
required payment to a local, state, or national government
Income received by government from taxes
A tax on people's earnings
a tax on the dollar value of a good or service being sold
tax
required payment to a local, state, or national government
revenue
Income received by government from taxes
31 terms
Chapter 14: Taxes and Government Spending
tax
revenue
progressive tax
proportional tax
a required payment to a local, state, or national government
the income received by a government form taxes and other nont…
A tax for which the percentage of income paid in taxes increa…
a tax for which the percentage of income paid in taxes remain…
tax
a required payment to a local, state, or national government
revenue
the income received by a government form taxes and other nont…
27 terms
Chapter 14: Self-Employment Tax and Other Taxes
What is the purpose of the self-employ…
In general, what is self-employment in…
List some groups who are exempt from s…
List some items that are excluded from…
Purpose is to provide Social Security and Medicare coverage a…
Net income from a trade, business, or profession operated by…
-nonresident aliens... -aliens who work for international organi…
-rents from real estate (unless in that business)... -rents from…
What is the purpose of the self-employ…
Purpose is to provide Social Security and Medicare coverage a…
In general, what is self-employment in…
Net income from a trade, business, or profession operated by…
27 terms
Tax Midterm Chapter 14
1)Upon the sale or other disposition o…
2)Ivan invests in land, and Grace inve…
3)Carol and Dave each purchase 100 sha…
4)If a taxpayer sells property for cas…
(LO 1)... •Is there a realized gain or loss?... •If so, is the real…
(LO 1) Over the five-year period, the results for Ivan and Gr…
(LO 1) Although the stock owned by Carol and by Dave decrease…
(LO 1)... a.Whether the property is sold for cash or on credit i…
1)Upon the sale or other disposition o…
(LO 1)... •Is there a realized gain or loss?... •If so, is the real…
2)Ivan invests in land, and Grace inve…
(LO 1) Over the five-year period, the results for Ivan and Gr…
12 terms
Chapter 14 State Taxes and Budgets and Tax Money
How do the budget from states differ f…
___________ _______________- about 1/3…
__________________- state average is o…
________________ _____________- about…
1. Almost every state requires that a balanced budget be subm…
Local government
Education
Public Welfare
How do the budget from states differ f…
1. Almost every state requires that a balanced budget be subm…
___________ _______________- about 1/3…
Local government
11 terms
TAX FINAL CHAPTER 14
dwelling unit
residence classification
flipping
acquistion indebtedness
a property that provides a place suitable for people to occup…
principal residence, residence, or nonresedince (rental prope…
fixing up a home and then in turn selling it
any debt secured by a qualified residence that is incurred in…
dwelling unit
a property that provides a place suitable for people to occup…
residence classification
principal residence, residence, or nonresedince (rental prope…
47 terms
Tax Quiz Chapter 14
General Partnership
Limited Partnership
Limited Liability Partnerships
Limited Liability Company
All partners are general partners so they can each be held pe…
Combo of general and limited partners. At least one partner i…
Partners are not personally liable for losses resulting from…
Taxed as a partnership but capital structure resembles a C-Corp
General Partnership
All partners are general partners so they can each be held pe…
Limited Partnership
Combo of general and limited partners. At least one partner i…
14 terms
Chapter 14 Tax Accounting (Final)
Dwelling Unit
Principal residence
Flipping
Acquisition indebtedness
property that provides a place suitable for people to occupy…
the main place of residence for a taxpayer during the taxable…
a term used to describe the real estate investment practice o…
debt secured by a qualified residence that is incurred in acq…
Dwelling Unit
property that provides a place suitable for people to occupy…
Principal residence
the main place of residence for a taxpayer during the taxable…
7 terms
Chapter 14: Tax Preparer Penalties
Realistic Possibility
Position not meeting realistic possibi…
Frivolous position
One-preparer-per-firm rule
a practitioner must not sign a return if determined the retur…
practitioner may recommend as long as it is not frivolous & t…
one that is patently improper under the tax law
should more than one member of a firm be involved in providin…
Realistic Possibility
a practitioner must not sign a return if determined the retur…
Position not meeting realistic possibi…
practitioner may recommend as long as it is not frivolous & t…
23 terms
Taxes Chapter 14
Tax Base
Individual Income Tax
Sales Tax
Property Tax
the income, property, good or service that is subject to a tax
the tax base might be a persons income
the dollar value of a good or service being sold
the value of someone's property
Tax Base
the income, property, good or service that is subject to a tax
Individual Income Tax
the tax base might be a persons income
21 terms
Chapter 14: Taxes
taxes
revenue
tax base
sales tax
money paid to the government for services
money taken in through taxes
The maximum amount of earnings on which a tax is calculated
A tax on a sale of merchandise or services
taxes
money paid to the government for services
revenue
money taken in through taxes
22 terms
Chapter 14: The Individual Tax Formula
filing status
joint return
joint and several liability
surviving spouse
a classification for individual taxpayers reflecting marital…
a return filed by a husband or wife reflecting their combined…
each spouse on a joint tax return is individually liable for…
Filing status that permits a widow or widower to use the marr…
filing status
a classification for individual taxpayers reflecting marital…
joint return
a return filed by a husband or wife reflecting their combined…
36 terms
Tax Unit 4- Chapter 14
property transactions
property transactions
determination of gain or loss
amount realized
model for gains --> amount realized - adjusted basis = realiz…
model for losses --> amount realized - adjusted basis = reali…
realization is the ceiling on recognition ... amount of realize…
gross sales price - selling expenses ... gross sales price incl…
property transactions
model for gains --> amount realized - adjusted basis = realiz…
property transactions
model for losses --> amount realized - adjusted basis = reali…
32 terms
Tax: Chapter 14 Part 2
deduction= benefit depends on marginal…
refundable and nonrefundable
can reduce the tax liability to 0, but…
can reduce the tax liability to below…
difference between a deduction benefit and a credit benefit
two credit types
nonrefundable credits
refundable credits
deduction= benefit depends on marginal…
difference between a deduction benefit and a credit benefit
refundable and nonrefundable
two credit types
24 terms
Taxes Chapter 14 Vocab
Above the line deduction
AGI
Bunching
Child credit
Allowable deduction for an individual taxpayer that can be su…
TI-adj... Intermediate step in taxable income calculation
Tax planning technique to concentrate itemized decductions in…
Credit based on number of taxpayers dependent children under 17
Above the line deduction
Allowable deduction for an individual taxpayer that can be su…
AGI
TI-adj... Intermediate step in taxable income calculation
38 terms
Chapter 14 taxes
Tax base
Proportional tax
Progressive tax
Regressive tax
Income, property, good or service that is subject to a tax
% of income paid in taxes remains the same for all income lev…
% of income paid in taxes increase as income increases
% of income paid in taxes decrease as income increases
Tax base
Income, property, good or service that is subject to a tax
Proportional tax
% of income paid in taxes remains the same for all income lev…
30 terms
Chapter 14 Taxes
Sin Tax
Individual Income Tax
Sales Tax
Progressive Tax
a relatively high tax designed to raise revenue and reduce co…
a tax based on a person's earnings
general state or city tax levied on a product at the time of…
A tax for which the percentage of income paid in taxes increa…
Sin Tax
a relatively high tax designed to raise revenue and reduce co…
Individual Income Tax
a tax based on a person's earnings
24 terms
Economics: chapter 14 taxes
Tax
Revenue
Progressive tax
Regressive tax
Is a required pavement to a local state or national government
The income received by a government from taxes and other no t…
Is a tax for which the percentage of income paid in taxes inc…
Is a tax for which the percentage of income paid in taxes dec…
Tax
Is a required pavement to a local state or national government
Revenue
The income received by a government from taxes and other no t…
30 terms
Chapter 14 Taxes
Sin Tax
Individual Income Tax
Sales Tax
Progressive Tax
a relatively high tax designed to raise revenue and reduce co…
a tax on a person's earnings
A tax on a sale of merchandise or services
A tax for which the percentage of income paid in taxes increa…
Sin Tax
a relatively high tax designed to raise revenue and reduce co…
Individual Income Tax
a tax on a person's earnings
33 terms
Chapter 14: Death and Taxes
**Progressive
**Regressive
**Proportion
**Tax Burden
Higher income groups pay larger share... Subject: Taxation
Lower income groups pay larger share... Subject: Taxation
Everyone pays similar percentage... Subject: Taxation
Taxation in proportion to personal income ... **TX= low tax bur…
**Progressive
Higher income groups pay larger share... Subject: Taxation
**Regressive
Lower income groups pay larger share... Subject: Taxation
16 terms
Tax Quiz 3: Chapter 14
Total Income
Adjustments: "Above the line"
Adjusted Gross Income
Standard Deduction
- wages, salaries, commissions, tips... -investment income-- int…
1) IRA deduction... 2) Student Driven Adjustments (student loan…
AGI= Total income- Adjustments
1) Basic Amount pg. 427... 2) Additional Amount: ... -1250 for each…
Total Income
- wages, salaries, commissions, tips... -investment income-- int…
Adjustments: "Above the line"
1) IRA deduction... 2) Student Driven Adjustments (student loan…
40 terms
Economics Chapter 14 - Taxes
Tax
Revenue
"Good taxes"
Internal Revenue Service (IRS) manual
primary way that the government collects money so it can oper…
income received by the government from taxes and other non-ta…
• Simple to understand... • Do not provide negative incentives... •…
2,500 pages
Tax
primary way that the government collects money so it can oper…
Revenue
income received by the government from taxes and other non-ta…
9 terms
HR BLOCK ITC Tax Terms Chapter 14
Acquisition Debt
General Sales Tax
Itemized deductions
Medicare Part A
Debt incurred to acquire, construct, or improve the... taxpayer'…
A general sales tax is a sales tax imposed on retail... sales of…
Certain personal expenditures allowed by the Tax... Code as dedu…
The medicare tax taken out of an employee's wages,... or the sam…
Acquisition Debt
Debt incurred to acquire, construct, or improve the... taxpayer'…
General Sales Tax
A general sales tax is a sales tax imposed on retail... sales of…
91 terms
TAX Final Exam Chapter 14
In general terms, the tax laws favor t…
Renting a residence may have nontax ad…
A personal residence is not a capital…
A taxpayer may be required to include…
True
True
False
True
In general terms, the tax laws favor t…
True
Renting a residence may have nontax ad…
True
12 terms
Chapter 14: Social Security and Tax Considerations
Fully Insured
Currently Insured
Lump-Sum Death Benefit
Surviving Spouse's Benefits
a status of complete eligibility for the full range of social…
under social security status of limited eligibility that prov…
helps the deceased's survivors to pay for funeral costs-may n…
the surviving spouse of a fully insured worker is entitled at…
Fully Insured
a status of complete eligibility for the full range of social…
Currently Insured
under social security status of limited eligibility that prov…
41 terms
Chapter 14: Health Concepts and Tax Considerations
Patient Protection and Affordable Care…
Health Insurance Marketplace
Requirements of the PPACA
Eligibility for PPACA
-signed in March 23, 2010... -controls healthcare costs... -expands…
a resource where individuals, families, and small businesses…
individuals are responsible for obtaining "minimum essential…
unless exempt, Americans are required to obtain a maintain mi…
Patient Protection and Affordable Care…
-signed in March 23, 2010... -controls healthcare costs... -expands…
Health Insurance Marketplace
a resource where individuals, families, and small businesses…
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