Tax Consulting Tax Credits and Deductions 2

Question 1

What is the maximum American Opportunity Tax Credit (AOTC) available per eligible student per year?

Accepted Answer

$2,500

Answer

$1,500

Answer

$2,000

Answer

$3,500

Question 2

How does the self-employed health insurance deduction differ from the itemized medical expense deduction?

Accepted Answer

It is an above-the-line deduction not subject to the 7.5% AGI floor

Answer

It is limited to 50% of premiums paid

Answer

It requires the taxpayer to have employees

Answer

It only applies to dental and vision premiums

Question 3

At what AGI level does the Child Tax Credit begin to phase out for single filers in 2024?

Accepted Answer

$200,000

Answer

$100,000

Answer

$150,000

Answer

$250,000

Question 4

What is the primary purpose of the Section 179 expense deduction?

Accepted Answer

To allow immediate expensing of qualifying business property rather than depreciation

Answer

To defer capital gains on qualifying property sales

Answer

To deduct exactly 50% of asset cost in the placed-in-service year

Answer

To carry back business losses to prior profitable tax years

Question 5

Which of the following expenses does NOT qualify for the Lifetime Learning Credit?

Accepted Answer

On-campus room and board

Answer

Required tuition fees

Answer

Required course enrollment fees

Answer

Textbooks required as a condition of enrollment

Question 6

Which usage test must a taxpayer satisfy to claim the home office deduction?

Accepted Answer

The space must be used regularly and exclusively for business

Answer

The space must be used at least 50% of the time for business

Answer

The space must be used for client meetings at least monthly

Answer

The space must be dedicated to business use at least 8 hours per week

Question 7

What is the 2024 HSA contribution limit for an individual with self-only high-deductible health plan (HDHP) coverage?

Accepted Answer

$4,150

Answer

$3,200

Answer

$3,850

Answer

$4,300