Question 2

a. Which of the following statements regarding late filing penalties is true?

		"If a taxpayer fails to file a tax return, the late filing penalty will continue to grow until the taxpayer files the tax return."
		The amount of the late filing penalty is the same for both fraudulent failure to file and nonfraudulent failure to file.
		Taxpayers who owe no tax as of the due date of their tax returns are not subject to late filing penalties even if they file late.
		None of the choices are correct.
		All of the choices are correct.

b. Employees are allowed to deduct a portion of the FICA taxes they pay.

True

False

c. "Long-term capital gains, dividends, and taxable interest income are all taxed at preferential rates."

True

False

d. Taxpayers are not required to file a tax return unless their gross income passes a certain threshold. This threshold is generally the ________.

		applicable standard deduction amount
		AMT exemption amount
		twice the applicable standard deduction amount
		applicable standard deduction amount plus the personal exemption amount
		AGI