Question 23 The TCJA introduced in 2018 brought considerable tax credits to many taxpayers, and in turn, they paid fewer taxes. Taking into account the TCJA law, what is the best definition of the Qualified Business Income (QBI) deduction? a) QBI is a deduction that can be combined with the Standard Deduction, and it should be itemized. b) QBI allows Sole Proprietors, shareholders in an S-Corporation, partners in a partnership and trust and estates to claim a deduction for up to 20 percent of qualified domestic income from that Sole Proprietorship, S-Corporation, or partnership. c) QBI is a deduction related to domestic income and can only be used by the list of taxpayers authorized by the IRS. d) QBI is a deduction that is only claimed on Form 1040 - U.S. Individual Income Tax Return.

Question 24 Which of the following statements regarding refundable and nonrefundable credits is not correct? a) Refundable credits, such as the Earned Income Credit and part of Education Credits, are funds completely refunded to the taxpayer. b) Nonrefundable credits reduce the taxpayers tax liability, and refundable credits increase the federal tax payments. c) Nonrefundable credits include the Child and Dependent Care Credit. d) An example of a refundable credit is the Health Coverage Tax Credit and the Additional Child Tax Credit. Question 26 Which of the following statements regarding the Alternative Minimum Tax (AMT) under the TCJA is

correct?

a) The AMT is eliminated for all taxpayers in 2021. b) The income level at which the exemption is phased-out has increased in 2021. c) Employees who report passive activities may be subject to the AMT. d) The preference items for the AMT have not changed between 2018-2025.

Question 27 In 2022, Henry drove 1,200 miles in total for his outpatient medical treatments. What is Henrys mileage

expense if the Standard Mileage Rate is applied? a) $216 b) $168 c) $192 d) Medical mileage deduction is not allowed.

Question 28 Frederick has an IRA account. He unfortunately lost his job in February of 2021. Although Frederick found another job in August, he did not have enough savings to cover expenses for his period of unemployment. Frederick took a distribution of $8,000 from his IRA and used it to pay for household expenses. Since federal taxes of 20% were withheld, he received a net amount of $6,400. Frederick is 58 years old, earned wages of $25,000 for the year, and files as MFJ. His wife Julie, is 66. What will Fredericks taxable income be for 2021? a) $ 4,950 b) $ 7,900 c) $ 6,550 d) $(1,450)