Individual Income Tax Flashcards
6 cards from real CTA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Individual Income Tax flashcards as text
Which of the following is NOT included in gross income under IRC Section 61?
Answer: Child support received
Child support payments are not included in the recipient's gross income under federal tax law.
What is the maximum contribution limit to a traditional IRA for taxpayers under age 50 in 2024?
Answer: $7,000
The IRA contribution limit for 2024 is $7,000 for taxpayers under age 50.
Which tax form reports interest income received from a bank or financial institution?
Answer: Form 1099-INT
Form 1099-INT reports interest income paid by financial institutions.
What is the holding period required for a capital gain to be classified as long-term?
Answer: More than 1 year
An asset must be held for more than one year to qualify for long-term capital gains treatment.
Which of the following education benefits is excluded from an employee's gross income?
Answer: Employer-provided educational assistance up to $5,250
Under IRC Section 127, employer-provided educational assistance up to $5,250 per year is excluded from the employee's gross income.
The alternative minimum tax (AMT) was designed primarily to ensure that:
Answer: High-income taxpayers cannot use too many deductions to eliminate their tax liability
The AMT was enacted to prevent high-income taxpayers from using deductions and credits to avoid paying federal income tax.