Which of the following statements is false?

A.	The provisions of IRC 121 for sale of personal residences are mandatory unless a specific election is made not to have IRC 121 apply.
B.	A taxpayer can make an election to report and pay tax on the sale of a residence if the taxpayer so chooses.
C.	A married couplemust file a joint tax return to exclude $500,000 of gain on the sale of their personal residence.
D.	All of the above are true.

1. Which of the following statements is false?

   A.	Expenses for maintaining the taxpayer's entire home must be allocated between business and personal use.
   B.	Direct expenses are deductible without allocation.
   C.	Indirect expenses must be allocated between business and personal use usually based upon a fraction the numerator of which is the square footage of the home office andthe denominatorbeing the total square footage of the home.
   D.	None of the above are false.

1. Assuming the taxpayerowned and lived full-time inthe property in which he claimed a home office deduction for the past five years, which of the following statements is correct regarding theexlusionof gain upon sale under IRC 121?

   A.	The taxpayer may not excludeany gain on the sale of the residence because using the home as an office transforms the property from personal use to a bona-fide business use. Gains on business use property are fully taxable.
   B.	Thetaxpayermay exclude the gain on the sale of the residence but must recapture all home office deductions as income in the year of sale.
   C.	The taxpayer must allocate the gain that isexcludablefrom the gain that is taxable based upon the square footage of the office as a percentage of the square footage of the entire property.
   D.	The taxpayer must recapture as income all depreciation allowable on the property for the previous five years the home officededuction was taken. The rest of the gain on the home is tax-free up to the statutory dollar limitations of $250000 for single & $500000 for married taxpayers.
   E.	None of the above is correct.

1. Which of the following statements is false regarding a taxpayer who rents half the square footage of his residence to anunrelatedthird party tenant while living full-time in the other half?

   A.	Despite that only 50% of the property is rented, 100% of the rent collected by the taxpayer is fully taxable.
   B.	If the above taxpayer rents hishome for less than 15 days during the tax year, no rental income needs to be reported.
   C.	While the above taxpayer may deduct (in the appropriate place on his tax return) 100% of the mortgage interest and real estate taxes on his residence, the taxpayer may only deduct half of the other rental expenses (insurance, depreciation, etc.) attributable to the one-half portion of his residence that is rented.
   D.	All of the above are true.

1. Which of the following statements is false?

   A.	If a taxpayer rents his home for less than 15 days during the tax year, the only deductions allowed on the property are those allowed as an itemized deduction such as mortgage interest, real estate taxes, and casualty losses.
   B.	If a taxpayer uses his home as a residence and also rents out the home for more than 15 days and meets the other personal use requirements of the IRC, generally the taxpayer may deduct rental expenses only to the extent of gross rental income. To the extent mortgage interest and taxes exceed rental income, the excess may be deducted on schedule A as an itemized deduction.
   C.	In addition to the limitations on rental activity deductions imposed by the residence rules of IRC 280A, the at-risk rules and passive activityloss rules may also apply to limit deductions attributable to rental property.
   D.	If a residence is converted from personalto investment or rental use, the depreciation deductionshallbe based on the adjusted basis of the property at the date of conversion.
   E.	All of the above are true.