7SV 5187 80. Most military veteran benefits are nontaxable. Which one of the following statements is correct in this regard? a. Education and training benefits are taxable. b. Disability payments are taxable. c. Grants for homes designed for a wheelchair are taxable. d. Retirement pay based on length of service is taxable. Ted raced stock cars for a hobby with no intention of making a profit. In the last full year, he earned $1,300 from his racing. He had $1500 in expenses from his racing activity. Which one of the following statements is correct in this regard? 81. a. Ted may include $1,500 in deductions on his tax return. b. Ted is limited to $1,300 in expenses on his tax return and only if he itemize deductions on Schedule A. c. Ted is limited to $1,000 in expenses on his tax return. d. Ted must take any allowable losses on Form 1040, Schedule C 82. Some amounts you receive in a court settlement are taxable and some are not. Which one of the following expenses is not taxable? a. Compensation for lost wages. b. Interest on any award. c. Personal physical injury damages d. Damages for copyright infringement. Which one of the following statements is correct in regard to payments for Notary Public services? 83. a. The payments may be reported on Schedule B, (Form 1040). b. The payments may be reported on Schedule E, (Form 1040). c. The payments are not subject to self-employment tax. d. The payments must be reported on Form 1040, line 21, as other income. 84. Hal had $5,000 in gambling winnings and $2,000 in gambling losses during the year. Assuming Hal did not qualify to itemize his deductions on Schedule A, what amount must Hal report as income? a. $0 b. $1,000 c. $3,000 d. $5,000 18