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 a 'above-the-line' deduction for individual taxpayers?
Answer: Student loan interest
Student loan interest is an above-the-line deduction, meaning it reduces adjusted gross income regardless of whether the taxpayer itemizes.
What is the tax treatment of a Roth IRA qualified distribution?
Answer: Tax-free and penalty-free
Qualified Roth IRA distributions are completely tax-free and penalty-free because contributions were made with after-tax dollars.
Which of the following Social Security benefits are potentially taxable?
Answer: Up to 85% of benefits if combined income exceeds thresholds
Up to 85% of Social Security benefits may be taxable if the taxpayer's combined income exceeds the applicable threshold.
What is the net investment income tax (NIIT) rate imposed by the ACA on high-income individuals?
Answer: 3.8%
The Net Investment Income Tax is 3.8% on the lesser of net investment income or the excess of MAGI over the threshold amount.
Which deduction allows self-employed individuals to deduct health insurance premiums?
Answer: Self-employed health insurance deduction (above-the-line)
Self-employed individuals may deduct 100% of health insurance premiums as an above-the-line deduction under IRC Section 162(l).
What is the maximum Child Tax Credit per qualifying child for tax year 2024?
Answer: $2,000
The Child Tax Credit is $2,000 per qualifying child under age 17 for tax year 2024.