A deduction for parking and other traffic violations incurred during business use of an automobile is allowed under the actual cost method but not the automatic mileage method. a. True b. False

10. Traditional but not Roth IRAs possess the advantage of tax-free accumulation of income within the plan. a. True

b. False

11. Nathan owns Activity A, which produces income, and Activity B, which produces passive activity losses. From a tax planning perspective, Nathan will be better off if Activity A is passive. a. True b. False

12. Joyce owns an activity (not real estate) in which she participates for 100 hours a year; her spouse participates for 450 hours. Joyce qualifies as a material participant. a. True b. False