CTA Tax Credits and Deductions

Question 1

The Earned Income Tax Credit (EITC) is available to taxpayers who:

Accepted Answer

Have earned income below certain thresholds and meet other eligibility requirements

Answer

Have investment income above $10,000

Answer

Are retired with Social Security income

Answer

Have capital gains from stock sales

Question 2

Which of the following credits directly reduces the tax liability dollar-for-dollar?

Accepted Answer

Tax credit

Answer

Tax deduction

Answer

Tax exclusion

Answer

Tax deferral

Question 3

The American Opportunity Tax Credit (AOTC) provides a maximum credit of how much per eligible student?

Accepted Answer

$2,500

Answer

$1,500

Answer

$2,000

Answer

$4,000

Question 4

Which deduction allows taxpayers to deduct up to $300 ($600 MFJ) for charitable contributions without itemizing?

Accepted Answer

Above-the-line charitable deduction for cash contributions

Answer

Standard deduction add-on for charity

Answer

Charitable mileage deduction

Answer

Schedule A miscellaneous deduction

Question 5

The Child and Dependent Care Credit provides a credit based on what percentage of qualifying expenses?

Accepted Answer

20-35% depending on AGI

Answer

10-15% depending on income

Answer

50% for all taxpayers

Answer

25% with a phase-out

Question 6

Home mortgage interest is deductible on a taxpayer's primary and secondary residence on debt up to what limit (post-2017)?

Accepted Answer

$750,000

Answer

$500,000

Answer

$1,000,000

Answer

$1,500,000