1.Over the years, Monica contributed $15,000 to a Roth IRA opened 10 years ago. The Roth IRA has a current value of $37,500. She is 54 years old and takes a distribution of $25,000. How much of the distribution will be taxable to Monica?

	a.	$0
	b.	$10,000
	c.	$15,000
	d.	$25,000

2.Which of the following isdeductible as interest expense on Schedule A?

	a.	Loan fee charged for appraisal service
	b.	Interest on single premium life insurance
	c.	Interest on a car loan
	d.	Home mortgage prepayment penalties

3.Carla and Rita are married, file a joint return, and have two dependent children, ages 11 and 13. Their AGI is $417,000. How much is their child tax credit in 2022?

	a.	$2,000
	b.	$1,150
	c.	$4,000
	d.	$3,150

4.Vernon is a cash basis taxpayer with a calendar tax year. On October 1, 2022, Vernon entered into a lease to rent a building for use in his business at $3,000 a month. On that day, Vernon paid 18 months' rent on the building, a total of $54,000 ($3,000 18 months). How much may Vernon deduct for rent expense on his 2022 tax return?

	a.	$9,000
	b.	$12,000
	c.	$36,000
	d.	$54,000

5.Tyler has a mortgage loan on his personal residence. He decides to pay 18 months of interest ($2,000 per month or $36,000 total) in advance on October 1, 2022. How much of the advance interest payment can he deduct in 2022?

	a.	$6,000
	b.	$12,000
	c.	$24,000
	d.	$36,000

6.How much is the refundable portion of the child tax credit for a taxpayer with one or two eligible children?

	a.	The lesser of $1,500 per child or 15 percent of the taxpayer's earned income over $2,500
	b.	The greater of $1,500 per child or 15 percent of the taxpayer's earned income over $2,500
	c.	The lesser of $2,000 per child or 15 percent of the taxpayer's earned income over $1,500
	d.	The greater of $2,000 per child or 15 percent of the taxpayer's earned income over $1,500

7.An asset (not an automobile) put in service in June 2022 has a depreciable basis of $1,095,000, has a recovery period of 5 years, and is the only asset placed in service during the year. Assuming bonus depreciation is used, a half-year convention, and the expensing election is made, what is the maximum amount of cost that can be deducted in 2022 (assume no income limitation)?

	a.	$211,000
	b.	$500,000
	c.	$1,095,000
	d.	$1,080,000

8.Which of the following is true about capital gains?

	a.	Short-term capital gains are offset first by short-term capital losses.
	b.	Short-term capital gains are subject to special tax treatment.
	c.	Long-term capital gains are never taxed.
	d.	Net long-term capital gains are offset by short-term capital gains.

9.What is the minimum number of years over which computers may be depreciated under MACRS?

	a.	3 years
	b.	5 years
	c.	7 years
	d.	10 years

10.Selma owns a beach cottage that she rents to tourists. In the current year, she rented the cottage for 90 days. What is the maximum number of days Selma can use the cottage before her expense deduction will be limited to her gross rental income?

	a.	0 days
	b.	9 days
	c.	14 days
	d.	18 days

11.Sol purchased land as an investment on January 12, 2019, for $85,000. On January 31, 2022, Sol sold the land for $90,000 cash. What is the nature of the gain or loss?

	a.	Long-term capital loss
	b.	Long-term capital gain
	c.	Short-term capital gain
	d.	Short-term capital loss

12.Which of the following is not deductible as an itemized deduction?

	a.	State and local income taxes
	b.	Personal property taxes
	c.	Donation of a car to a charitable organization
	d.	The value of use of taxpayer's property by a nonprofit

13.Keith has a 2022 tax liability of $2,250 before taking into account his American Opportunity tax credit. He paid $2,600 in qualifying expenses, was a full-time student, and was not claimed as a dependent on his parents' return, and his American Opportunity tax credit was not subject to phase-out. What is the amount of his American Opportunity tax credit allowed?

	a.	$0
	b.	$2,150
	c.	$2,250
	d.	$2,600

14.Aaliyah is a calendar year taxpayer reporting on the cash basis. Indicate which of the following income or expense items should not be included in her 2022 tax return.

	a.	On April 15, 2022, she makes a deductible contribution to her IRA for 2022.
	b.	She prepays half a year of interest in advance on her mortgage on the last day of 2022.
	c.	She pays all her outstanding invoices for standard business expenses in the last week of December 2022.
	d.	She receives payment in February 2022 for work done in December 2021.

15.The 3.8 percent Medicare tax does not apply to which of the following?

	a.	Interest
	b.	Dividends
	c.	Capital gains
	d.	Wages

SHORT ANSWER - 55 POINTS TOTAL

16.Brad works at the local pizza shop as a delivery person. He is hoping to change to a position in the kitchen and takes a culinary course at the local community college for $1,400. Assuming he is eligible,how much is Brad's lifetime learning credit? (5 points)

17.Fletch and Cammie are married with three dependent children and household income of $82,836 in 2022. They purchased health care insurance on their state's exchange for total premiums of $6,800. A designated silver plan for their family in their state costs $9,700. The poverty level for a family of five is $31,040, and the applicable percentage is 4.80 percent. Calculate their premium tax credit. (10 points)

18.In the current year, Jeanette sells her personal residence of the last 40 years for $365,000. Jeanette's basis in her residence is $70,000. The expenses associated with the sale of her home total $20,000. Jeanette decides to move in with her daughter rather than purchase a new residence. Calculate Jeanette's realized gain and recognized gain on the sale of her residence. (10 points)

a.	Realized gain
b.	Recognized gain

19.Mitch and Sydney file a joint income tax return for 2022. They have two dependent children, students, ages 19 and 20. Mitch earns wages of $908,000, and Mitch and Sydney have interest income of $102,000. In 2022, they settle a state tax audit and pay $50,000 for back state taxes due to an overly aggressive tax-sheltered investment. Their other expenses for the year include: (25 points)

Mortgage interest	$23,000
Real estate taxes	12,000
State taxes withheld	33,500
Cash charitable contributions	56,000
CPA fees for assistance with the state audit	4,500

a.	Calculate Mitch and Sydney's 2022 regular tax and tentative minimum tax on the schedule provided.

Regular tax:
Adjusted gross income	$_________
Itemized deductions:
______________________________	__________
______________________________	__________
______________________________	__________
______________________________	__________
______________________________	__________
______________________________	__________
Total itemized deductions	__________
Taxable income	$_________
Tax from 2022 tax rate schedule	$_________
Alternative minimum tax:
Adjusted gross income	$_________
Add tax preferences and adjustments:	__________
Less allowable deductions:
______________________________	__________
______________________________	__________
______________________________	__________
______________________________	__________
Total deductions	$_________
Alternative minimum taxable income	__________
AMT exemption ($114,600)	__________
Alternative minimum tax base
Tentative minimum tax	$_________
(26 percent of income up to $206,100; 28 percent of income in excess of $206,100)

b.	How much is the total tax liability shown on Mitch and Sydney's 2022 Form 1040?

20.Beverly is the sole owner of Bev & Associates, an accrual basis corporation. In 2022, Bev & Associates has an unprofitable year, and Beverly lends the corporation $50,000 to meet expenses. The corporation accrues interest expense of $5,000 on the loan from Beverly but does not pay the interest to her in cash.

How much of the $5,000 in accrued interest expense can Bev & Associates deduct on its 2022 corporate tax return? Explain. (5 points)