6. Long term capital gain can be taxed at a maximum rate of:

a. 15 percent

b. 25 percent

c. 28 percent

d. A and C

e. Depending on the asset sold, the maximum rate could be 15, 25, or 28 percent.

7. The maximum amount of net capital losses individuals may deduct against their ordinary income per year is:

a. $3,000

b. $5,000

c. Zero losses are not deductible

d. There is no maximum. All losses are allowed to be deducted.

e. None of these.

8.Lax , LLc purchased only one asset during the current year. It palced in service computer equiptment (5 year property) on August 26 with a basis of $20,000. Calculate the maximum depreciation expense for the current year(ingnoring section 179 and bonus depreciation).

a. $2,000

b. $2,858

c. 3,000

d. $4,000

e. None of these

9. Which of the following is true regaring depreciation recapture?

a. Changes the character of a loss

b. Changes the character of a gain.

c. Changes the amount of a gain

d. Only applies to ordinary assets

e. None of these.

10.If an individual taxpayer's marginal tax rate is 35% and holds the following assets for more than a year, which gains will be taxed at the highest rate at the time of sales?

a. gains from investment land

b. gain from personal use property

c. gains from a coin collection

d. gains from the sale of qualified small business stock held for 3 years.

e. gains attributable to tax depreciation taken on real property.