Tax Preparation Deductions and Credits 2

Question 1

Which of the following is NOT deductible as a mortgage interest deduction?

Accepted Answer

Interest on a mortgage for a vacation home above the $750,000 limit

Answer

Interest on a first mortgage of $700,000

Answer

Points paid to obtain a mortgage on a primary home

Answer

Interest on a home equity loan used for home improvement

Question 2

A taxpayer contributes $3,000 to a traditional IRA. They are covered by a workplace retirement plan and have an AGI that exceeds the phase-out range. What is the IRA deduction?

Accepted Answer

$0

Answer

$3,000

Answer

$1,500

Answer

$6,000

Question 3

What is the 2024 maximum contribution to a Health Savings Account (HSA) for self-only coverage?

Accepted Answer

$4,150

Answer

$3,200

Answer

$3,850

Answer

$7,750

Question 4

The Child and Dependent Care Credit is calculated as a percentage of which amount?

Accepted Answer

The lesser of actual expenses or $3,000 ($6,000 for 2+)

Answer

Total childcare costs paid

Answer

The taxpayer's earned income

Answer

The dependent's income

Question 5

Charitable cash contributions to qualified organizations are generally limited to what percentage of AGI?

Accepted Answer

60%

Answer

30%

Answer

50%

Answer

100%

Question 6

The Lifetime Learning Credit (LLC) provides a maximum annual credit of:

Accepted Answer

$2,000

Answer

$1,000

Answer

$2,500

Answer

$4,000