Question 1

Using the choices provided below, show the justification for each provision of the tax law listed.
-Tax credits for home improvements that conserve energy.

Accepted Answer

The answer of Using the choices provided below, show the...

Question 2

Using the choices provided below, show the justification for each provision of the tax law listed.
-A bribe to the local sheriff, although business related, is not deductible.

Accepted Answer

The answer of Using the choices provided below, show the...

Question 3

Match the statements that relate to each other. Note: Some choices may be used more than once or not at all.
-Export taxes

Accepted Answer

The answer of Match the statements that relate to each...

Question 4

Using the choices provided below, show the justification for each provision of the tax law listed.
-A deduction for interest on student loans.

Accepted Answer

The deduction for interest on student loans is justified by both economic and social considerations.
Economically, it is believed that a well-educated workforce is essential for economic growth and development. By allowing individuals to deduct the interest on their student loans, it encourages more people to pursue higher education and acquire the skills needed for today's jobs.
Socially, the deduction for interest on student loans is believed to promote social mobility and accessibility to higher education. It helps students, particularly those from low-income families, to acquire skills and knowledge needed for jobs that may not be accessible to them otherwise.

Question 5

Using the choices provided below, show the justification for each provision of the tax law listed.
-More rapid expensing for tax purposes of the costs of installing pollution control devices.

Accepted Answer

The provision of more rapid expensing for tax purposes of the costs of installing pollution control devices is justified by economic considerations as it provides incentives for companies to invest in and install pollution control equipment, which in turn leads to reduced pollution and environmental damage, and ultimately benefits the economy as a whole by improving public health and reducing the costs of cleaning up pollution.

Question 6

Using the choices provided below, show the justification for each provision of the tax law listed.
-A Federal deduction for state and local sales taxes paid.

Accepted Answer

The answer of Using the choices provided below, show the...

Question 7

Using the choices provided below, show the justification for each provision of the tax law listed.
-A small business corporation can elect to avoid the corporate income tax.

Accepted Answer

The provision allowing small business corporations to avoid corporate income tax is primarily based on economic considerations. Small businesses are often the engines of job creation and economic growth, and allowing them to reinvest their profits into the business rather than paying corporate taxes can encourage their growth and success. This provision also aims to level the playing field between small businesses and larger corporations that may have more resources to handle the burden of corporate taxes. While there may be some social considerations in supporting small businesses, the primary justification for this provision is economic.

Question 8

Using the choices provided below, show the justification for each provision of the tax law listed.
-A tax credit for amounts spent to furnish care for children while the parent is at work.

Accepted Answer

The answer of Using the choices provided below, show the...

Question 9

Using the choices provided below, show the justification for each provision of the tax law listed.
-A deduction for contributions by an employee to certain retirement plans.

Accepted Answer

Both economic and social considerations justify the provision allowing employees to deduct contributions to retirement plans. Economically, the provision incentivizes individuals to save for their future retirement, which can help reduce the burden on social safety net programs. Socially, the provision encourages individuals to be financially responsible and plan for their future, which can lead to overall financial stability for individuals and society as a whole.

Question 10

Using the choices provided below, show the justification for each provision of the tax law listed.
-Additional depreciation deduction allowed for the year the asset is acquired.

Accepted Answer

The additional depreciation deduction is allowed to encourage businesses to invest in new assets, which can stimulate economic growth and may increase employment. This provision also incentivizes businesses to replace and upgrade outdated equipment, which can improve productivity and efficiency.

Question 11

Using the choices provided below, show the justification for each provision of the tax law listed.
-Tax brackets are increased for inflation.

Accepted Answer

This provision is related to equity considerations as it ensures that individuals with similar levels of income are taxed similarly. The tax brackets are adjusted for inflation to prevent individuals from being pushed into higher tax brackets due to inflation-driven increases in their nominal incomes. This ensures that taxpayers with the same real income pay the same amount of taxes, promoting horizontal equity in the tax system.

Question 12

Match the statements that relate to each other. Note: Some choices may be used more than once or not at all.
-Import taxes (customs duties)

Accepted Answer

The answer of Match the statements that relate to each...

Question 13

Using the choices provided below, show the justification for each provision of the tax law listed.
-A deduction for certain expenses (interest and taxes) incident to home ownership.

Accepted Answer

The deduction for certain expenses related to home ownership is justified by both economic considerations and social considerations. From an economic perspective, the deduction helps to incentivize home ownership and stimulate the housing market, which can have a positive impact on the broader economy. From a social perspective, the deduction is aimed at promoting stable communities and encouraging families to put down roots in a particular area. Additionally, the deduction can help to make home ownership more accessible and affordable for lower-income individuals and families, which supports equity considerations. Therefore, both economic and social considerations justify this provision of the tax law.

Question 14

Using the choices provided below, show the justification for each provision of the tax law listed.
-A deduction for qualified tuition paid to obtain higher education.

Accepted Answer

The deduction for qualified tuition paid to obtain higher education can be justified by both economic and social considerations. From an economic standpoint, the deduction can provide an incentive for individuals to pursue higher education, which may lead to higher paying jobs and increased economic productivity. From a social standpoint, the deduction can help promote access to education, which can lead to increased social mobility and opportunities for individuals from lower-income backgrounds. Therefore, the deduction can be justified by both a. and b.

Question 15

Using the choices provided below, show the justification for each provision of the tax law listed.
-Contributions to charitable organizations are deductible.

Accepted Answer

The answer of Using the choices provided below, show the...

Question 16

Using the choices provided below, show the justification for each provision of the tax law listed.
-Tax credits available for the purchase of a vehicle that uses alternative (non-fossil) fuels.

Accepted Answer

The answer of Using the choices provided below, show the...

Question 17

Match the statements that relate to each other. Note: Some choices may be used more than once.
-Office audit

Accepted Answer

The answer of Match the statements that relate to each...

Question 18

Match the statements that relate to each other. Note: Some choices may be used more than once or not at all.
-"Pay-as-you-go" (paygo)

Accepted Answer

The answer of Match the statements that relate to each...

Question 19

Using the choices provided below, show the justification for each provision of the tax law listed.
-A Federal deduction for state and local income taxes paid.

Accepted Answer

The answer of Using the choices provided below, show the...

Question 20

Match the statements that relate to each other. Note: Some choices may be used more than once or not at all.
-Income tax amnesty

Accepted Answer

The answer of Match the statements that relate to each...

Quiz 1: An Introduction to Taxation and Understanding the Federal Tax Law

Using the choices provided below, show the justification for each provision of the tax law listed. -Tax credits for home improvements that conserve energy.

Using the choices provided below, show the justification for each provision of the tax law listed. -A bribe to the local sheriff, although business related, is not deductible.

Match the statements that relate to each other. Note: Some choices may be used more than once or not at all. -Export taxes

Using the choices provided below, show the justification for each provision of the tax law listed. -A deduction for interest on student loans.

Using the choices provided below, show the justification for each provision of the tax law listed. -More rapid expensing for tax purposes of the costs of installing pollution control devices.

Using the choices provided below, show the justification for each provision of the tax law listed. -A Federal deduction for state and local sales taxes paid.

Using the choices provided below, show the justification for each provision of the tax law listed. -A small business corporation can elect to avoid the corporate income tax.

Using the choices provided below, show the justification for each provision of the tax law listed. -A tax credit for amounts spent to furnish care for children while the parent is at work.

Using the choices provided below, show the justification for each provision of the tax law listed. -A deduction for contributions by an employee to certain retirement plans.

Using the choices provided below, show the justification for each provision of the tax law listed. -Additional depreciation deduction allowed for the year the asset is acquired.

Using the choices provided below, show the justification for each provision of the tax law listed. -Tax brackets are increased for inflation.

Match the statements that relate to each other. Note: Some choices may be used more than once or not at all. -Import taxes (customs duties)

Using the choices provided below, show the justification for each provision of the tax law listed. -A deduction for certain expenses (interest and taxes) incident to home ownership.

Using the choices provided below, show the justification for each provision of the tax law listed. -A deduction for qualified tuition paid to obtain higher education.

Using the choices provided below, show the justification for each provision of the tax law listed. -Contributions to charitable organizations are deductible.

Using the choices provided below, show the justification for each provision of the tax law listed. -Tax credits available for the purchase of a vehicle that uses alternative (non-fossil) fuels.

Match the statements that relate to each other. Note: Some choices may be used more than once. -Office audit

Match the statements that relate to each other. Note: Some choices may be used more than once or not at all. -"Pay-as-you-go" (paygo)

Using the choices provided below, show the justification for each provision of the tax law listed. -A Federal deduction for state and local income taxes paid.

Match the statements that relate to each other. Note: Some choices may be used more than once or not at all. -Income tax amnesty