31) 31) Mae Li is beneficiary of a $70,000 insurance policy on her father's life. Upon his death, she elects to receive the proceeds in installments from the insurance company that carries the policy. She will receive $16,000 per year for five years. What are the tax consequences each year? A) There is no taxable income. B) S2,000 of the $16,000 payment is taxable each year, $10,000 interest is taxable in the first year. D) AU $16.00) each year is taxable. 32) 32) Derrick was in an automobile accident while he was going to work. The doctor advised him to stay home fur eight months due to his physical injuries. The resulting lawsuit was settled and Derrick received the following amounts: Compensatory damages for physical injury Punitive damages $80,000 95,000 How much of the settlement must Derrick include in ordinary income on his tax return? A) $80,000 B) $175,000 C) $95,000 D) $0 33) 33) Connor owes $1 million and has assets of only $1 million. He declares and files personal and business bankruptcy and his creditors approve a payment plan of $.25 per dollar. Conor has a net operating loss carryover of S2 million. The remaining 75 percent of his debt will be canceled. Connor must recognize inoxme of A) SO. B) Si million C) $2 million. D) $3 million 34) 34) Kole eams $150,000 in 2021 in his job as a sales manager. What is his FICA Lax? A) $11,475 B) C D) $11,029 35) 35) Which of the following taxes is progressive? A) excise tax property tax B) sales tax D) federal income tax 36) 36) Which of the following is not a taxpaying entity? A) individual partnership B) Corporation D) All of the above are taxpayers. 37) 37) Tercot Partnership reported $1,000,000 of business receipts, $700,000 of business deductions, and $100,000 of interest income. Terry is a 50% partner in Tercot Partnership. On Terry's relurn, she will be entitled to a deduction for qualified business income of A) $30,000 B) $40,000. C) $60,000 D) $80,000 38) 38) Charlie is claimed as a dependent by his parents in 2021. He received $8,000 during the year from a part-time acting job, which was his only income. What is his standard deduction? A) $12,550 B) $1,100 C) $8,000 D) $8,350