PLEASE ANSWER ALL QUESTIONS 163 - 172

Question 163

Under final regulations, a self-employed taxpayer may elect to apply a de minimis safe harbor to amounts he or she paid to acquire or produce tangible property to the extent such amounts are deducted by him or her for financial accounting purposes or in keeping his or her books and records. For taxable years beginning on or after January 1, 2016, the Internal Revenue Service increased the de minimis safe harbor threshold to what amount per invoice or item for self-employed taxpayers without applicable financial statements?

A.$500

B.$1,000

C.$2,000

D.$2,500

Question 164

Ken Larch is a tailor. He bought two industrial sewing machines from his father. He placed both machines in service in the same year he bought them. All of the following are true except:

A.The sewing machines do not qualify as section 179 property

B.Ken cannot claim a section 179 deduction for the cost of these machines

C.Ken can claim a partial section 179 deduction

D.The asset must be used at least 50% of the time for business in the first year it is placed in service to qualify for a section 179 deduction

Question 165

Sandy is a single taxpayer who collected Social Security benefits of $22,000. The Social Security benefits were her only income for the tax year. What is the amount of taxes she will owe when she files her income tax return?

A.$0

B.$2,200

C.$5,500

D.$11,000

Question 166

In 2015, Joelle received $3,000 in Social Security benefits, and in 2016 she received $2,700. In March 2016, the Social Security Administration (SSA) notified her that she should have received only $2,500 in benefits in 2016. During 2016, she repaid $500 to SSA. The Form SSA-1099 she received for 2016 shows what amount for her net benefits?

A.$500

B.$2,200

C.$2,500

D.$2,700

Question 167

George, who is 34 years old and single, earns $24,000 in 2016. His IRA contributions for 2016 are limited to what amount?

A.$0

B.$1,000

C.$3,500

D.$5,500

Question 168

Danny, an unmarried college student working part-time, earns $3,500 in 2016. His IRA contributions for 2016 are limited to what amount?

A.$0

B.$1,000

C.$3,500

D.$5,500

Question 169

Wayne, age 53, and Janet, age 51, are married and file a joint return. Wayne is covered by an employer retirement plan. In 2016, Wayne had compensation of $50,000 and Janet had compensation of $175,000. Their AGI was $200,000. What is the amount of the deductible contribution that can be made for Janet to her traditional IRA for 2016?

A.$0

B.$2,500

C.$3,000

D.$5,000

Question 170

The pension or annuity payments that a taxpayer receives are fully taxable if he or she has no cost in the contract because of which of the following situations?

A.The taxpayer did not pay anything or is not considered to have paid anything for the pension or annuity. Amounts withheld from his or her pay on a tax-deferred basis are not considered part of the cost of the pension or annuity payment

B.The taxpayers employer did not withhold contributions from his or her salary

C.The taxpayer received all of his or her contributions tax free in prior years

D.All of the above

Question 171

Sarah, age 52, is married with no taxable compensation for 2016. She and her husband reported taxable compensation of $60,000 on their 2016 joint income tax return. Sarah may contribute what amount to her IRA for 2016?

A.$0

B.$1,000

C.$5,500

D.$6,500

Question 172

Elizabeth works for the Rockland Quarry Company, a small business with 50 employees. Rockland has decided to establish a SIMPLE IRA plan for its employees and will match its employees contributions dollar-for-dollar up to 3% of each employees compensation. Elizabeth has a yearly compensation of $50,000 and contributes 5% of her compensation to her SIMPLE IRA. What is the total contribution to Elizabeths SIMPLE IRA for 2016?

A.$0

B.$2,000

C.$2,500

D.$4,000