1) What is the basis for depreciation of property converted from personal-use to business-use?

a) The purchase price.

b)The greater of adjusted basis or FMV on the date of conversion.

c)The lesser of adjusted basis or FMV on the date of conversion.

d)The FMV to calculate depreciation and adjusted basis to calculate gain or loss.

2) Jamie converted $500 into Bitcoin in November 2018. In October 2019, when the value of his holding had increased to $1,500, Jamie decided to purchase a diamond ring using Bitcoin. He spent the entire holding on the ring. How will Jamie report this on his tax return?

a) No reporting is necessary when purchases are made using virtual currency.

b)He will report $1,500 as ordinary income.

c)No reporting is necessary until he sells the ring. At that time, he will report a gain or loss, depending on the sale price of the ring.

d)As a short-term capital gain of $1,000 on Form 8949. His basis in the ring is $1,500.

3) Gerald owns 465 shares of stock, with a basis of $2,831. The stock split 3 for 1. Gerald now owns ______ shares at ______ per share.

a) 465 shares @ $2.03 per share.

b) 465 shares @ $6.09 per share.

c) 1,395 shares @ $2.03 per share.

d) 1,395 shares @ $6.09 per share.

4) All of the following are deductible business expenses EXCEPT:

a) Membership in the local country club.

b) Protective clothing used in a taxpayer's line of work.

c) An entertainer's theatrical costume, if not suitable for everyday wear.

d) Up to $25 of the cost of a business gift to a current or prospective client.

5) Alice Mae has an interior decorating consultation business and uses her personal car to visit clients. She has used the standard deduction in the past, and knows she needs to track all of the following information in her mileage log EXCEPT:

a) Dates and odometer readings.

b) Total business and commuting miles, as well as the total miles the car was driven for the entire year.

c) The purpose of each trip, as well as the names of any clients present.

d) The cost of fuel, oil changes, and other maintenance items.

6) Maria paid $3,250 interest on a qualified student loan during 2019. She is filing a joint return with her husband, Julio, and their MAGI is $145,000. The maximum amount of student loan interest that Maria and Julio can deduct on their return is __________.

a) $3,250

b) $2,500

c) $2,083

d) $0