Certified Public Accountant Taxation — Individual & Corporate 3

Question 1

What is the net investment income tax (NIIT) rate imposed under the Affordable Care Act on high-income individuals?

Accepted Answer

3.8%

Answer

0.9%

Answer

2.5%

Answer

5.0%

Question 2

Under the IRC, what is the maximum deductibility limit for business meals (as of 2023 and beyond)?

Accepted Answer

50% deductible

Answer

100% deductible

Answer

75% deductible

Answer

25% deductible

Question 3

What is the federal tax treatment of alimony payments under divorce agreements executed after December 31, 2018?

Accepted Answer

Not deductible by the payer, not includable in recipient's income

Answer

Deductible by the payer, includable in recipient's income

Answer

Deductible by both parties

Answer

Treated as a gift and subject to gift tax

Question 4

Which depreciation method allows businesses to deduct a larger portion of an asset's cost in the early years of its life?

Accepted Answer

Double declining balance

Answer

Straight-line depreciation

Answer

Units of production

Answer

Sum-of-the-years-digits

Question 5

What is the corporate alternative minimum tax (CAMT) rate introduced under the Inflation Reduction Act of 2022?

Accepted Answer

15%

Answer

10%

Answer

20%

Answer

25%

Question 6

Under the Tax Cuts and Jobs Act, what is the maximum deduction for qualified business income (QBI) available to pass-through entity owners?

Accepted Answer

20% of qualified business income

Answer

10% of qualified business income

Answer

25% of qualified business income

Answer

50% of W-2 wages paid