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1. One indicia of independent contractor (rather than employee) status is when the individual performing the services is
paid based on time spent (rather than on tasks performed).
a. True
b. False
ANSWER: False
RATIONALE: What is described is a criterion for employee classification.
POINTS: 1
DIFFICULTY: Easy
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: CMPV.SWFT.LO: 9-01 - LO: 9-01
NATIONAL STANDARDS: United States - BUSPORG: Comprehension - BUSPORG:Comprehension
STATE STANDARDS: United States - AK - AICPA: FN-Measurement -
AICPA: FN-Measurement
KEYWORDS: Bloom's: Comprehension
OTHER: Time: 2 min.
DATE CREATED: 11/28/2016 3:32 PM
DATE MODIFIED: 5/11/2017 1:07 PM
2. In some cases it may be appropriate for a taxpayer to report work-related expenses by using both Form 2106 and
Schedule C.
a. True
b. False
ANSWER: True
RATIONALE: A taxpayer with two jobs may be both an employee (Form 2106) and self-employed
(Schedule C).
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES CMPV.SWFT.LO: 9-01 - LO: 9-01
:
STATE STANDARDS: United States - AK - AICPA: FN-Reporting

OTHER: Time: 2 min.
3. The IRS will issue advanced rulings as to whether a worker’s status is that of an employee or an independent contractor.
a. True
b. False
ANSWER: True
RATIONALE: A ruling from the IRS can be obtained by filing Form SS–8.
POINTS: 1
DIFFICULTY: Easy
KEYWORDS: Bloom's: Knowledge
OTHER: Time: 2 min.
4. Jake performs services for Maude. If Maude provides a helper and tools, this is indicative of independent contractor
(rather than employee) status.
a. True
b. False
ANSWER: False
RATIONALE: Because Jake does not provide his own helper and tools, this indicates that he is probably not an
independent contractor.
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTI CMPV.SWFT.LO: 9-01 - LO: 9-01
VES:
NATIONAL STANDA United States - BUSPORG: Comprehension - BUSPORG:Comprehension
RDS:

OTHER: Time: 2 min.
5. A statutory employee is not a common law employee but is subject to Social Security tax.
a. True
b. False
ANSWER: True
RATIONALE: A statutory employee is subject to Social Security tax.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
6. For tax purposes, a statutory employee is treated the same as a common law employee.
a. True
b. False
ANSWER: False
RATIONALE: Among other differences, statutory employees claim their expenses as deductions for AGI on
Schedule C.
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVE CMPV.SWFT.LO: 9-01 - LO: 9-01
S:
NATIONAL STANDARD United States - BUSPORG: Comprehension - BUSPORG:Comprehension
S:
OTHER: Time: 2 min.
7. If an individual is subject to the direction or control of another only to the extent of the end result but not as to the
means of accomplishment, an employer-employee relationship does not exist.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
8. The work-related expenses of an independent contractor will be subject to the 2%-of-AGI floor.
a. True
b. False
ANSWER: False
RATIONALE: The expenses are deductions for AGI. Only certain itemized deductions are subject to the 2%
limitation.
POINTS: 1
DIFFICULTY: Easy
S: CMPV.SWFT.LO: 9-11 - LO: 9-11
S:
OTHER: Time: 2 min.
9. After she finishes working at her main job, Ann returns home, has dinner, then drives to her second job. Ann may
deduct the mileage between her first and second job.
a. True
b. False
ANSWER: True
RATIONALE: The deduction is based on the mileage between the first and the second job.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
10. A taxpayer who maintains an office in the home to conduct his only business will not have nondeductible commuting
expense.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
11. After the automatic mileage rate has been set by the IRS for a year, it cannot later be changed by the IRS.
a. True
b. False
ANSWER: False
RATIONALE: In the past and because of rising fuel costs, the IRS has raised the rates in midyear.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
12. In choosing between the actual expense method and the automatic mileage method, a taxpayer should consider the
cost of insurance on the automobile.
a. True
b. False
ANSWER: True
RATIONALE: If taxpayer lives and works in a metropolitan area and a significant commute is involved, car
insurance premiums could be quite costly.
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJEC CMPV.SWFT.LO: 9-02 - LO: 9-02
TIVES:
NATIONAL STAND United States - BUSPORG: Comprehension - BUSPORG:Comprehension
ARDS:
STATE STANDARD United States - AK - AICPA: FN-Measurement -
S: AICPA: FN-Measurement
OTHER: Time: 2 min.
13. A taxpayer who uses the automatic mileage method to compute auto expenses can also deduct the business portion of
tolls and parking.
a. True
b. False
ANSWER: True
RATIONALE: Such costs are deductible under both methods.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
14. A deduction for parking and other traffic violations incurred during business use of the automobile is allowed under
the actual cost method but not the automatic mileage method.
a. True
b. False
ANSWER: False
RATIONALE: No such deduction is allowed under either method.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
15. A taxpayer who uses the automatic mileage method for the business use of an automobile can change to the actual cost
method in a later year.
a. True
b. False
ANSWER: True
RATIONALE: An adjustment to the basis of the automobile will have to be made for the depreciation deemed
taken under the automatic mileage method.
POINTS: 1
DIFFICULTY: Easy
TIVES:
ARDS:
STATE STANDAR United States - AK - AICPA: FN-Measurement -
DS: AICPA: FN-Measurement
OTHER: Time: 2 min.
16. Once the actual cost method is used, a taxpayer cannot change to the automatic mileage method in a later year.
a. True
b. False
ANSWER: False
RATIONALE: A change is permitted if MACRS (statutory percentage method) depreciation has not been used or
the § 179 election to expense was not made.
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJE CMPV.SWFT.LO: 9-02 - LO: 9-02

CTIVES:
NATIONAL STANDUnited States - BUSPORG: Comprehension - BUSPORG:Comprehension
ARDS:
OTHER: Time: 2 min.
17. For tax purposes, “travel” is a broader classification than “transportation.”
a. True
b. False
ANSWER: True
RATIONALE: Travel expenses include transportation expenses and meals and lodging while away from home in
the pursuit of a trade or business.
POINTS: 1
DIFFICULTY: Easy
TIVES: CMPV.SWFT.LO: 9-03 - LO: 9-03
ARDS:
STATE STANDARD United States - AK - AICPA: FN-Measurement -
S: AICPA: FN-Measurement
OTHER: Time: 2 min.
18. Amy lives and works in St. Louis. In the morning she flies to Boston, has a three-hour business meeting, and returns to
St. Louis that evening. For tax purposes, Amy was away from home.
a. True
b. False
ANSWER: False
RATIONALE: The absence must be a period substantially longer than an ordinary day’s work and must
require rest.
POINTS: 1
DIFFICULTY: Easy
S:
NATIONAL STANDARDS United States - BUSPORG: Comprehension - BUSPORG:Comprehension
:
OTHER: Time: 2 min.
19. James has a job that compels him to go to many different states during the year. It is possible that James was never
away from his tax home during the year.
a. True
b. False
ANSWER: True
RATIONALE: This could be the case of a long-haul truck driver where his tax home goes with
him.
POINTS: 1
DIFFICULTY: Easy

OTHER: Time: 2 min.
20. Marvin lives with his family in Alabama. He has two jobs: one in Alabama and one in North Carolina. Marvin’s tax
home is where he lives (Alabama).
a. True
b. False
ANSWER: False
RATIONAL Marvin’s tax home is where his principal job is located. This is determined by considering numerous factors,
E: among which are the level of income earned and the amount of time spent. Thus, it is incorrect to resolve the
tax home issue without more facts.
POINTS: 1
DIFFICULT Easy
Y:
QUESTION True / False
TYPE:
HAS VARIA False
BLES:
LEARNING CMPV.SWFT.LO: 9-03 - LO: 9-03
OBJECTIV
ES:
NATIONAL United States - BUSPORG: Comprehension - BUSPORG:Comprehension
STANDAR
DS:
STATE ST United States - AK - AICPA: FN-Reporting
ANDARDS:
KEYWORD Bloom's: Comprehension

S:
OTHER: Time: 2 min.
DATE CRE 11/28/2016 3:32 PM
ATED:
DATE MOD 5/11/2017 1:07 PM
IFIED:
21. A taxpayer who lives and works in Kansas City is sent to Chicago on an eight-day business trip. While in Chicago,
taxpayer uses the hotel valet service to have some laundry done. The valet charge is a nondeductible personal travel
expense.
a. True
b. False
ANSWER: False
RATIONALE: Valet service is part of the travel expense deduction.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
22. The tax law specifically provides that a taxpayer cannot be temporarily away from home for any period of
employment that exceeds one year.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
23. A taxpayer who lives and works in Tulsa travels to Buffalo for five days. If three days are spent on business and two
days are spent on visiting relatives, only 60% of the airfare is deductible.
a. True
b. False
ANSWER: False
RATIONALE: For domestic mixed travel (i.e., both business and personal), no allocation of transportation is
required.
POINTS: 1
DIFFICULTY: Easy
S:
S:
OTHER: Time: 2 min.
24. Bob lives and works in Newark, NJ. He travels to London for a three-day business meeting, after which he spends
three days touring Scotland. All of his air fare is deductible.
a. True
b. False
ANSWER: True
RATIONALE: Bob meets the seven-days-or-less exception.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
25. Eileen lives and works in Mobile. She travels to Rome for an eight-day business meeting, after which she spends two
days touring Italy. All of Eileen’s airfare is deductible.
a. True
b. False
ANSWER: True
RATIONALE: Eileen meets the less-than-25%-personal-time exception.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
26. Liam just graduated from college. Because it is his first job, the cost of moving his personal belongings from his
parents’ home to the job site does not qualify for the moving expense deduction.
a. True
b. False
ANSWER: False
RATIONALE: There is no prohibition against claiming moving expenses if the first job is involved.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
27. Sick of her 65 mile daily commute, Edna purchases a condo that is only four miles from her job. Edna’s moving
expenses to her new condo are not allowed and cannot be claimed by her as a deduction.
a. True
b. False
ANSWER: True
RATIONALE: Edna does not have qualified moving expenses since she did not change job locations.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
28. In November 2017, Katie incurs unreimbursed moving expenses to accept a new job. Katie cannot deduct any of these
expenses when she timely files her 2017 income tax return since she has not yet satisfied the 39-week time test.
a. True
b. False
ANSWER: False
RATIONALE: The deduction can be claimed even if the time test has not yet been met.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
29. In May 2017, after 11 months on a new job, Ken is fired after he assaults a customer. Ken must include in his gross
income for 2017 any deduction for moving expenses he may have claimed on his 2016 tax return.
a. True
b. False
ANSWER: False
RATIONALE: Since Ken worked for 11 months, he has already satisfied the 39-week time test.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
30. A moving expense deduction is allowed even if at the time of the move the taxpayer did not have a job at the new
location.
a. True
b. False
ANSWER: True
RATIONALE: As long as the taxpayer ultimately satisfies the time test, it does not matter when the work
assignment is obtained.
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIV CMPV.SWFT.LO: 9-04 - LO: 9-04
ES:
NATIONAL STANDAR United States - BUSPORG: Comprehension - BUSPORG:Comprehension
DS:

OTHER: Time: 2 min.
31. Kelly, an unemployed architect, moves from Boston to Phoenix to accept a job as a chef at a restaurant. Kelly’s
moving expenses are not deductible because her new job is in a different trade or business.
a. True
b. False
ANSWER: False
RATIONALE: For moving expenses to be deductible, a taxpayer need not remain in the same trade or
business.
POINTS: 1
DIFFICULTY: Easy
:

OTHER: Time: 2 min.
32. Alexis (a CPA) sold her public accounting practice in Des Moines and accepted a job with the Seattle office of a
national accounting firm. Her moving expenses are not deductible because she has changed employment status (i.e., went
from self-employed to employee).
a. True
b. False
ANSWER: False
RATIONALE: The change does not matter for purposes of the moving expense deduction.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 5 min.
33. Qualified moving expenses include the cost of lodging but not meals during the move.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
34. Qualified moving expenses of an employee that are not reimbursed are a deduction for AGI.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
35. At age 65, Camilla retires from her job in Boston and moves to Florida. As a retiree, she is not subject to the time test
in deducting her moving expenses.
a. True
b. False
ANSWER: False
RATIONALE: Camilla is not an expatriate and does not come under that exception.
POINTS: 1
DIFFICULTY: Easy
CMPV.SWFT.LO: 9-11 - LO: 9-11
OTHER: Time: 2 min.
36. After completing an overseas assignment in Oslo (Norway), Daniel retires from Pelican Corporation and moves to a
retirement community in Key West (Florida). Daniel’s moving expenses from Oslo to Key West are deductible as they are
exempt from the time test.
a. True
b. False
ANSWER: True
RATIONALE: A special exception for retiring expatriates applies.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
37. An education expense deduction may be allowed even if the education results in a promotion or pay raise for the
employee.
a. True
b. False
ANSWER: True
RATIONALE: There is no prohibition as to this result in deducting education expenses.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
38. Lloyd, a practicing CPA, pays tuition to attend law school. Since a law degree involves education leading to a new
trade or business, the tuition is not deductible.
a. True
b. False
ANSWER: False
RATIONALE: A deduction might be available under the § 222 qualified tuition for higher education provision. Here,
it does not matter that a new skill is being acquired.
POINTS: 1
DIFFICULTY: Easy
QUESTION TYPE True / False
:

CTIVES:
NATIONAL STAN United States - BUSPORG: Comprehension - BUSPORG:Comprehension
DARDS:
STATE STANDAR United States - AK - AICPA: FN-Reporting
DS:
OTHER: Time: 2 min.

39. Under the right circumstances, a taxpayer’s meals and lodging expense can qualify as a deductible education expense.
a. True
b. False
ANSWER: True
RATIONALE: If the education involves the taxpayer being away from home (i.e., in travel status).
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
40. There is no cutback adjustment for meals and entertainment as to employees who are subject to regulation by the U.S.
Department of Transportation.
a. True
b. False
ANSWER: False
RATIONALE: The cutback adjustment applies, but at a reduced rate.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
41. Mallard Corporation pays for a trip to Aruba for its two top salespersons. This expense is subject to the cutback
adjustment.
a. True
b. False
ANSWER: False
RATIONAL The cost of the trips to Aruba are additional compensation to the employees involved. Consequently, they
E: are not subject to the cutback adjustment and are fully deductible by Mallard Corporation. They are also
taxed as income to the employees.
POINTS: 1
DIFFICULT Easy
Y:
QUESTION True / False
TYPE:
HAS VARIA False
BLES:
OBJECTIV
ES:
STANDARD
S:
STATE STA United States - AK - AICPA: FN-Measurement -
NDARDS: AICPA: FN-Measurement
KEYWORD Bloom's: Knowledge
S:
OTHER: Time: 2 min.
DATE CRE 11/28/2016 3:32 PM
ATED:
DATE MOD 5/11/2017 1:07 PM
IFIED:
42. Flamingo Corporation furnishes meals at cost to its employees by means of a cafeteria it maintains. The cost of
operating the cafeteria is not subject to the cutback adjustment.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
43. A taxpayer takes six clients to an NBA playoff game. If all of the tickets (list price of $120 each) are purchased on the
Internet for $1,800 ($300 each), only $60 ($120 × 50% cutback adjustment) per ticket is deductible.
a. True
b. False
ANSWER: True
RATIONALE: $60 ($120 × 50% cutback adjustment) per ticket is deductible.
POINTS: 1
DIFFICULTY: Easy
KEYWORDS: Bloom's: Application
OTHER: Time: 5 min.
44. Ethan, a bachelor with no immediate family, uses the Pine Shadows Country Club exclusively for his business
entertaining. All of Ethan’s annual dues for his club membership are deductible.
a. True
b. False
ANSWER: False
RATIONALE: Dues to country clubs are not deductible.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
45. Jackson gives his supervisor and her husband each a $30 box of chocolates at Christmas. Jackson may claim only $25
as a deduction.
a. True
b. False
ANSWER: False
RATIONALE: As gifts to supervisors and spouses are not deductible, Jackson has no deduction.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
46. On their birthdays, Lily sends gift certificates (each valued at $25) to Caden (a key client) and to each of Caden’s two
minor children. Lily can deduct only $25 as to these gifts.
a. True
b. False
ANSWER: True
RATIONALE: These gifts will be aggregated in applying the $25 limit.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
47. Travis holds rights to a skybox (containing 10 seats) at Memorial Stadium which he uses to entertain key clients. At
one sporting event, he took only six clients since three were ill. Even so, Travis may still deduct the appropriate cost of all
ten seats.
a. True
b. False
ANSWER: True
RATIONALE:
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
48. In the case of an office in the home deduction, the exclusive business use test does not apply when the home is used as
a daycare center.
a. True
b. False
ANSWER: True
RATIONALE: Mixed use (i.e., business and personal) of the home is permitted in daycare situations.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
49. If a taxpayer does not own a home but rents an apartment, the office in the home deduction is not available.
a. True
b. False
ANSWER: False
RATIONALE: The only difference would be a substitution of rent expense for depreciation. Otherwise, the
deduction is equally available.
POINTS: 1
DIFFICULTY: Easy
VES:
RDS:
STATE STANDARDS:United States - AK - AICPA: FN-Reporting

OTHER: Time: 2 min.
50. A taxpayer who claims the standard deduction will not be able to claim an office in the home deduction.
a. True
b. False
ANSWER: False
RATIONALE: The office in the home deduction will be allowed if the taxpayer is self-employed.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
51. Under the regular (actual expense) method, the portion of the office in the home deduction that exceeds the income
from the business can be carried over to future years.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
52. For tax year 2016, Taylor used the simplified method of determining her office in the home deduction. For 2017,
Taylor must continue to use the simplified method and cannot switch to the regular (actual expense) method.
a. True
b. False
ANSWER: False
RATIONALE: A new choice is available each year. Taylor cannot, however, change the choice she
made for 2016.
POINTS: 1
DIFFICULTY: Easy
ES:
DS:
KEYWORDS: Bloom's: Comprehensive
OTHER: Time: 2 min.
53. Under the simplified method, the maximum office in the home deduction allowed is the greater of $1,500 or the office
square feet × $5.
a. True
b. False
ANSWER: False
RATIONALE: The deduction is office square feet x $5 but not to exceed $1,500 or the net income
from the business.
POINTS: 1
DIFFICULTY: Easy
ES:
DS:
OTHER: Time: 2 min.
54. If the cost of uniforms is deductible, their maintenance cost (e.g., laundry, dry cleaning, alterations) also is deductible.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
55. Tired of renting, Dr. Smith buys the academic robes she will wear at her college’s graduation procession. The cost of
this attire does not qualify as a uniform expense.
a. True
b. False
ANSWER: False
RATIONALE: These robes do qualify as they are not adaptable for ordinary wear.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
56. Frank, a recently retired FBI agent, pays job search expenses to obtain a position with a city police department.
Frank’s job search expenses do qualify as deductions.
a. True
b. False
ANSWER: True
RATIONALE: It appears that Frank is seeking a job in the same trade or business (i.e., law enforcement).
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
57. After graduating from college with a degree in chemistry, Alberto obtains a job as a chemist with DuPont. Alberto’s
job search expenses qualify as deductions.
a. True
b. False
ANSWER: False
RATIONALE: Job search expenses incurred in obtaining the first job are not deductible.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
58. Qualifying job search expenses are deductible even if the taxpayer does not change jobs.
a. True
b. False
ANSWER: True
RATIONALE: No job change requirement exists.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
59. Madison is an instructor of fine arts at a local community college. If she spends $600 (not reimbursed) on art supplies
for her classes, $250 of this amount can be claimed as a deduction for AGI.
a. True
b. False
ANSWER: False
RATIONALE: The $250 special rule for school supplies applies only to elementary and secondary school
teachers.
POINTS: 1
DIFFICULTY: Easy
S:
:
OTHER: Time: 2 min.
60. Both traditional and Roth IRAs possess the advantage of tax-free accumulation of income within the plan.
a. True
b. False
ANSWER: True
RATIONALE: In the case of a traditional IRA, however, the income will be taxed when distributed to the
participant.
POINTS: 1
DIFFICULTY: Easy
S:
:
OTHER: Time: 2 min.
61. When contributions are made to a traditional IRA, they are deductible by the participant. Later distributions from the
IRA upon retirement are fully taxed.
a. True
b. False
ANSWER: True
RATIONALE: Contributions are deductible, while distributions are taxable.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
62. By itself, credit card receipts will not constitute adequate substantiation for travel expenses.
a. True
b. False
ANSWER: True
RATIONALE: The credit card receipts establish the date, place, and amount of the expenditure. Because neither the
business relationship nor the business purpose is established, the substantiation is incomplete.
POINTS: 1
DIFFICULTY: Easy
QUESTION T True / False
YPE:
HAS VARIABL False
ES:
LEARNING O CMPV.SWFT.LO: 9-09 - LO: 9-09
BJECTIVES: CMPV.SWFT.LO: 9-11 - LO: 9-11
NATIONAL ST United States - BUSPORG: Comprehension - BUSPORG:Comprehension
ANDARDS:
STATE STAN United States - AK - AICPA: FN-Measurement -
DARDS: AICPA: FN-Measurement
OTHER: Time: 2 min.

DATE CREAT 11/28/2016 3:32 PM
ED:
DATE MODIFI 5/11/2017 1:08 PM
ED:
63. The Federal per diem rates that can be used for “deemed substantiated” purposes are the same for all locations in the
country.
a. True
b. False
ANSWER: False
RATIONALE: The Federal per diem rates are different for different locations in the United States.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
64. For self-employed taxpayers, travel expenses are not subject to the 2%-of-AGI floor.
a. True
b. False
ANSWER: True
RATIONALE: For self-employed taxpayers, travel expenses are deductions for adjusted gross income. The 2%-of-AGI
floor applies only to certain deductions from AGI, such as unreimbursed employee expenses.
POINTS: 1
DIFFICULTY: Easy
QUESTION T True / False
YPE:
HAS VARIABL False
ES:
BJECTIVES:
ANDARDS:
STATE STAN United States - AK - AICPA: FN-Reporting
DARDS:
OTHER: Time: 2 min.

DATE CREAT 11/28/2016 3:32 PM
ED:
ED:
65. A taxpayer who claims the standard deduction will not avoid the 2%-of-AGI floor on unreimbursed employee
expenses.
a. True
b. False
ANSWER: False
RATIONALE: The 2%-of-AGI floor applies only to miscellaneous itemized deductions. A taxpayer who claims the
standard deduction will not be itemizing.
POINTS: 1
DIFFICULTY: Easy

TIVES:
ARDS:
STATE STANDAR United States - AK - AICPA: FN-Reporting
DS:
OTHER: Time: 2 min.
66. Employees who render an adequate accounting to the employer and are fully reimbursed will shift the 50% cutback
adjustment to their employer.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
67. Aiden performs services for Lucas. Which, if any, of the following factors indicate that Aiden is an employee, rather
than an independent contractor?
a. Aiden provides his own support services (e.g., work assistants).
b. Aiden obtained his training (i.e., job skills) from his father.
c. Aiden is paid based on hours worked.
d. Aiden makes his services available to others.
e. None of these.
ANSWER: c
RATIONALE: Choices a., b., and d. reflect independent contractor status.
POINTS: 1
DIFFICULTY: Easy
QUESTION TYPE: Multiple Choice
OTHER: Time: 2 min.
68. Jordan performs services for Ryan. Which, if any, of the following factors indicate that Jordan is an independent
contractor, rather than an employee?
a. Ryan sets the work schedule.
b. Ryan provides the tools used.
c. Jordan files a Form 2106 with his Form 1040.
d. Jordan is paid based on tasks performed.
e. None of these.
ANSWER: d
RATIONALE: Choices a., b., and c. reflect employee status.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
69. Which, if any, of the following factors is not a characteristic of independent contractor status?
a. Work-related expenses are reported on Form 2106.
b. Receipt of a Form 1099 reporting payments received.
c. Workplace fringe benefits are not available.
d. Services are performed for more than one party.
e. None of these.
ANSWER: a
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
70. A worker may prefer to be treated as an independent contractor (rather than an employee) for which of the following
reasons:
a. Avoids the cutback adjustment as to business meals.
b. All of the self-employment tax is deductible for income tax purposes.
c. Work-related expenses are not subject to the 2%-of-AGI floor.
d. A Schedule C does not have to be filed.
e. None of these.
ANSWE c
R:
RATION Independent contractors are also subject to the cutback adjustment (choice a.). All of the self-employment tax
ALE: is not deductible (choice b.). Because all work-related expenses are deductions for AGI, the 2%-of-AGI
reduction is avoided (choice c.). Work-related expenses will have to be reported on Schedule C (choice d.).
POINTS: 1
DIFFICU Easy
LTY:
QUESTI Multiple Choice
ON TYP
E:
HAS VA False
RIABLES
:
LEARNI CMPV.SWFT.LO: 9-01 - LO: 9-01
NG OBJ CMPV.SWFT.LO: 9-11 - LO: 9-11
ECTIVES
:
NATION United States - BUSPORG: Comprehension - BUSPORG:Comprehension
AL STAN
DARDS:
STATE S United States - AK - AICPA: FN-Reporting

TANDAR
DS:
KEYWO Bloom's: Comprehension
RDS:
OTHER: Time: 2 min.
DATE C 11/28/2016 3:32 PM

REATED
:
DATE M 5/11/2017 1:08 PM
ODIFIED
:
71. A worker may prefer to be classified as an employee (rather than an independent contractor) for which of the
following reasons:
a. To claim unreimbursed work-related expenses as a deduction for AGI.
b. To avoid the self-employment tax.
c. To avoid the cutback adjustment on unreimbursed business entertainment expenses.
d. To avoid the 2%-of-AGI floor on unreimbursed work-related expenses.
e. None of these.
ANSWE b
R:
RATION The self-employment tax is twice the Social Security equivalent imposed on employees (choice b.). Most
ALE: unreimbursed employee expenses are deductions from AGI (choice a.) and will be subject to the 2%-of-AGI
adjustment (choice d.). Unreimbursed entertainment expenses will be subject to the cutback adjustment (choice
c.).
POINTS: 1
DIFFICU Easy
LTY:
ON TYP
E:
HAS VA False
RIABLES
:
ECTIVE
S:
AL STAN
DARDS:

TANDAR
DS:
RDS:
OTHER: Time: 2 min.
DATE C 11/28/2016 3:32 PM

REATED
:
DATE M 5/11/2017 1:08 PM
ODIFIED
:
72. Statutory employees:
a. Report their expenses on Form 2106.
b. Include common law employees.
c. Are subject to income tax withholdings.
d. Claim their expenses as deductions for AGI.
e. None of these.
ANSWER: d
RATIONA Their expenses are reported on Schedule C, not Form 2106 (choice a.). Although subject to Social Security
LE: tax, they are not subject to income tax withholdings (choice c.). Statutory employees are not common law
employees (choice b.). Expenses are deductions for AGI (choice d.).
POINTS: 1
DIFFICUL Easy
TY:
QUESTIO Multiple Choice
N TYPE:
HAS VARI False
ABLES:
LEARNIN CMPV.SWFT.LO: 9-01 - LO: 9-01
G OBJEC
TIVES:
NATIONA United States - BUSPORG: Comprehension - BUSPORG:Comprehension
L STAND
ARDS:
ANDARD
S:
KEYWOR Bloom's: Knowledge
DS:
OTHER: Time: 5 min.
DATE CR 11/28/2016 3:32 PM
EATED:
DATE MO 5/11/2017 1:08 PM
DIFIED:
73. Corey is the city sales manager for “RIBS,” a national fast food franchise. Every working day, Corey drives his car as
follows:
Miles
Home to office 20
Office to RIBS No. 1 15
RIBS No. 1 to No. 2 18
RIBS No. 2 to No. 3 13
RIBS No. 3 to home 30
Corey’s deductible mileage is:
a. 0 miles.
b. 50 miles.
c. 66 miles.
d. 76 miles.
e. None of these.
ANSWER: e
RATIONALE: 15 miles + 18 miles + 13 miles = 46 miles. The mileage for driving from his home to the office (20
miles) and from the last worksite to home (30 miles) is not deductible.
POINTS: 1
DIFFICULTY: Easy
QUESTION TYP Multiple Choice
E:
HAS VARIABLE False
S:
LEARNING OBJ CMPV.SWFT.LO: 9-02 - LO: 9-02
ECTIVES:
NATIONAL STA United States - BUSPORG: Comprehension - BUSPORG:Comprehension
NDARDS:
STATE STANDA United States - AK - AICPA: FN-Measurement -
RDS: AICPA: FN-Measurement
OTHER: Time: 5 min.
DATE CREATE 11/28/2016 3:32 PM
D:
DATE MODIFIE 5/11/2017 1:08 PM
D:
74. Amy works as an auditor for a large major CPA firm. During the months of September through November of each
year, she is permanently assigned to the team auditing Garnet Corporation. As a result, every day she drives from her
home to Garnet and returns home after work. Mileage is as follows:
Miles
Home to office 10
Home to Garnet 30
Office to Garnet 35
For these three months, Amy’s deductible mileage for each workday is:
a. 0.
b. 30.
c. 35.
d. 60.
e. None of these.
ANSWER: d
RATIONALE: The round trip from home to Garnet (at temporary job site) of 60 miles (30 miles × 2) is the
mileage that is deductible.
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVCMPV.SWFT.LO: 9-02 - LO: 9-02
ES:
DS:
OTHER: Time: 5 min.
75. Aaron is a self-employed practical nurse who works out of his home. He provides nursing care for disabled persons
living in their residences. During the day he drives his car as follows.
Miles
Aaron’s home to patient Louise 12
Patient Louise to patient Carl 4
Patient Carl to patient Betty 6
Patient Betty to Aaron’s home 10
Aaron’s deductible mileage for each workday is:
a. 10 miles.
b. 12 miles.
c. 20 miles.
d. 22 miles.
e. 32 miles.
ANSWER: e
RATIONALE: Since Aaron’s office is in his home, he has no nondeductible commuting mileage—all of the
mileage is deductible.
POINTS: 1
DIFFICULTY: Easy
ES:
DS:
OTHER: Time: 5 min.
76. When using the automatic mileage method, which, if any, of the following expenses also can be claimed?
a. Engine tune-up.
b. Parking.
c. Interest on automobile loan.
d. MACRS depreciation.
e. None of these.
ANSWER: b
RATIONALE: Choices a., c., and d. would be allowed under the actual cost method.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
77. In which, if any, of the following situations is the automatic mileage available?
a. A limousine to be rented by the owner for special occasions (e.g., weddings, high school proms).
b. The auto belongs to taxpayer’s mother.
c. One of seven cars used to deliver pizzas.
d. MACRS statutory percentage method has been claimed on the automobile.
e. None of these.
ANSWER: e
RATIONALE: Multiple vehicles (5 or more) cannot qualify (choice c.) nor can vehicles held for hire (choice a.). The
car must be owned or leased by the taxpayer (choice b.).
POINTS: 1
DIFFICULTY: Easy
E:
HAS VARIABLES False
:
CTIVES:
DARDS:
OTHER: Time: 2 min.
DATE MODIFIED 5/11/2017 1:08 PM

:
78. Under the actual cost method, which, if any, of the following expenses will not be allowed?
a. Car registration fees.
b. Auto insurance.
c. Interest expense on a car loan (taxpayer is an employee).
d. Dues to auto clubs.
e. All of these will be allowed.
ANSWER: c
RATIONALE: Interest on a car loan is deductible only by a self-employed taxpayer (not an employee)—choice c. (This
assumes the car financing is not handled with a home equity loan—see Chapter 10.)
POINTS: 1
DIFFICULTY: Easy
QUESTION TY Multiple Choice
PE:
HAS VARIABL False
ES:
LEARNING OB CMPV.SWFT.LO: 9-02 - LO: 9-02
JECTIVES:
ANDARDS:
STATE STANDUnited States - AK - AICPA: FN-Measurement -
ARDS: AICPA: FN-Measurement
OTHER: Time: 2 min.
DATE CREAT 11/28/2016 3:32 PM
ED:
ED:
79. Dave is the regional manager for a national chain of auto-parts stores and is based in Salt Lake City. When the
company opens new stores in Boise, Dave is given the task of supervising their initial operation. For three months, he
works weekdays in Boise and returns home on weekends. He spends $350 returning to Salt Lake City but would have
spent $410 had he stayed in Boise for the weekend. As to the weekend trips, how much, if any, qualifies as a deduction?
a. $0, since the trips are personal and not work related.
b. $0, since Dave’s tax home has changed from Salt Lake City to Boise.
c. $60
d. $350
e. $410
ANSWER: d
RATIONALE: Dave’s assignment in Boise is temporary, so his tax home has not changed (choice b.). Dave’s deduction
is limited to the lesser of what he actually spent and what he would have spent had he not returned home
(choice d.).
POINTS: 1
DIFFICULTY Easy
:
QUESTION Multiple Choice
TYPE:
HAS VARIA False
BLES:
OBJECTIVE
S:
NATIONAL S United States - BUSPORG: Comprehension - BUSPORG:Comprehension
TANDARDS:

KEYWORDS Bloom's: Application
:
OTHER: Time: 5 min.
DATE CREA 11/28/2016 3:32 PM
TED:
DATE MODI 5/11/2017 1:08 PM
FIED:
80. Allowing for the cutback adjustment (50% reduction for meals and entertainment), which of the following trips, if
any, will qualify for the travel expense deduction?
a. Dr. Jones, a general dentist, attends a two-day seminar on developing a dental practice.
b. Dr. Brown, a surgeon, attends a two-day seminar on financial planning.
c. Paul, a romance language high school teacher, spends summer break in France, Portugal, and Spain improving
his language skills.
d. Myrna went on a two-week vacation in Boston. While there, she visited her employer’s home office to have
lunch with former co-workers.
e. All of these.
ANSWER: a
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES:CMPV.SWFT.LO: 9-03 - LO: 9-03
OTHER: Time: 5 min.
81. During the year, John went from Milwaukee to Alaska on business. Preceding a five-day business meeting, he spent
four days vacationing at the beach. Excluding the vacation costs, his expenses for the trip are:
Air fare $3,200
Lodging 900
Meals 800
Entertainment 600
Presuming no reimbursement, deductible expenses are:
a. $3,200.
b. $3,900.
c. $4,800.
d. $5,500.
e. None of these.
ANSWER: c
RATIONALE: $3,200 + $900 + $700 [50%($800 + $600)] = $4,800. No allocation is required for domestic
transportation costs (i.e., the airfare) since the trip is primarily business related.
POINTS: 1
DIFFICULTY: Moderate
E:
HAS VARIABLE False
S:
ECTIVES:
NDARDS:
STATE STANDAUnited States - AK - AICPA: FN-Measurement -
OTHER: Time: 10 min.
D:
D:
82. During the year, Sophie went from Omaha to Lima (Peru) on business. She spent four days on business, two days on
travel, and four days on vacation. Disregarding the vacation costs, Sophie’s unreimbursed expenses are:
Air fare $3,000

Lodging 800
Meals 600
Entertainment 400
Sophie’s deductible expenses are:

a. $4,300.
b. $3,100.
c. $2,800.
d. $2,500.
e. None of these.
ANSWER: b
RATIONAL $1,800 [60% (6 days business/10 day trip) × $3,000 (air fare)] + $800 + $500 [50%($600 + $400)] = $3,100.
E: The air fare has to be allocated as Sophie did not meet either the seven days (or less) or less than 25%
personal use exceptions for foreign travel.
POINTS: 1
DIFFICULT Moderate
Y:
TYPE:
HAS VARIAFalse
BLES:
OBJECTIV
ES:
STANDAR
DS:
STATE ST United States - AK - AICPA: FN-Measurement -
ANDARDS: AICPA: FN-Measurement
KEYWORD Bloom's: Application

S:
DATE CRE 11/28/2016 3:32 PM
ATED:
DATE MOD 5/11/2017 1:08 PM
IFIED:
83. During the year, Walt travels from Seattle to Tokyo (Japan) on business. His time was spent as follows: 2 days travel
(one day each way), 2 days business, and 2 days personal. His expenses for the trip were as follows (meals and lodging
reflect only the business portion):
Air fare $3,000
Lodging 2,000
Meals and entertainment 1,000
Presuming no reimbursement, Walt’s deductible expenses are:
a. $3,500.
b. $4,500.
c. $5,500.
d. $6,000.
e. None of these.
ANSWER: c
RATIONALE: $3,000 + $2,000 + (50% × $1,000) = $5,500 . Since the 7-days-or-less exception applies, the full
airfare ($3,000) is allowed.
POINTS: 1
VES:
RDS:
STATE STANDARDS United States - AK - AICPA: FN-Measurement -
: AICPA: FN-Measurement
84. In terms of meeting the distance test for purposes of deducting moving expenses, which of the following statements is
correct?
a. The taxpayer’s new job location must be at least 50 miles away from the old job.
b. The taxpayer’s new residence must be at least 50 miles away from the new job.
c. The taxpayer’s new residence must be at least 50 miles away from the old residence.
d. The taxpayer’s new job location must be at least 50 miles farther from the old residence than the old residence
was to the old job.
e. None of these.
ANSWER: d
RATIONAL The distance comparison is between the old residence to the old job and old residence to new job (choice
E: d.). In this regard, the location of the new residence is immaterial (choices b. and c.), as is the distance
between the old and new jobs (choice a.).
POINTS: 1
DIFFICULT Easy
Y:
TYPE:
HAS VARIA False
BLES:
OBJECTIV
ES:
STANDAR
DS:
ANDARDS:

S:
OTHER: Time: 2 min.
DATE CRE 11/28/2016 3:32 PM
ATED:
DATE MOD 5/11/2017 1:08 PM
IFIED:
85. As to meeting the time test for purposes of deducting moving expenses, which of the following statements is correct?
a. Work at the new location must involve a full-time job—part-time job will not suffice.
b. The taxpayer has two years in which to satisfy the 39-weeks or 78-weeks requirement.
c. The time test is waived for persons whose move follows retirement.
d. The moving expense deduction cannot be claimed if the taxpayer has not yet met the time test.
e. None of these.
ANSWER: a
RATIONALE Full-time status (not part-time) is required (choice a.). The two-year limitation applies only to the 78-week
: option—twelve months is required for the 39-week option (choice b.). The retirement waiver applies only to
expatriates (choice c.).
POINTS: 1
DIFFICULT Easy
Y:
TYPE:
HAS VARIA False
BLES:
OBJECTIVE
S:
STANDARD
S:
STATE STA United States - AK - AICPA: FN-Reporting
NDARDS:
S:
OTHER: Time: 2 min.
DATE CRE 11/28/2016 3:32 PM
ATED:
DATE MODI 5/11/2017 1:08 PM
FIED:
86. Due to a merger, Allison transfers from Miami to Chicago. Under a new job description, she is reclassified from
employee to independent contractor status. Her moving expenses, which are not reimbursed, are as follows:
Transportation $1,400
Meals 400
Lodging 500
Cost of moving household goods 4,000
Penalty for breaking lease on Miami apartment 3,000
Allison’s deductible moving expense is:
a. $0.
b. $5,900.
c. $6,100.
d. $8,900.
e. $9,300.
ANSWE b
R:
RATION $1,400 (transportation) + $500 (lodging) + $4,000 (moving household goods) = $5,900 (choice b.). Meals are
ALE: not qualified moving expenses (choices c. and e.) nor are penalties for breaking a lease (choices d. and e.). It is
immaterial that Allison’s status as an employee changed to that of an independent contractor (choice a.).
POINTS: 1
DIFFICU Moderate
LTY:
ON TYP
E:
HAS VA False
RIABLES
:
NG OBJ
ECTIVE
S:
AL STAN
DARDS:
STATE S United States - AK - AICPA: FN-Measurement -

TANDAR AICPA: FN-Measurement
DS:
KEYWO Bloom's: Application
RDS:
DATE C 11/28/2016 3:32 PM

REATED
:
DATE M 5/11/2017 1:08 PM
ODIFIED
:
87. Rachel is single and has a college degree in finance. She is employed as a loan officer at a bank; her yearly AGI
approximates $50,000. During the year, she enrolled in a weekend MBA program and incurred the following
nonreimbursed expenses: $4,100 (tuition), $300 (books), $200 (other school supplies), and $200 (transportation to and
from campus). Disregarding the 2%-of-AGI limitation, as to the MBA program, Rachel has a:
a. Deduction for and deduction from AGI of $0.
b. Deduction for AGI of $4,000 and deduction from AGI of $800.
c. Deduction for AGI of $4,000 and deduction from AGI of $700.
d. Deduction for AGI of $4,100 and deduction from AGI of $700.
e. None of these.
ANSWER: b
RATIONAL Section 222 allows up to $4,000 for qualified tuition and related expenses. As Rachel spent $4,100, she can
E: claim only $4,000 as a deduction for AGI. The remaining expenses of $800 ($100 + $300 + $200 + $200)
can be claimed as deductions from AGI.
POINTS: 1
DIFFICULT Moderate
Y:
TYPE:
HAS VARIAFalse
BLES:
OBJECTIV
ES:
STANDAR
DS:
KEYWORD Bloom's: Application

S:
DATE CRE 11/28/2016 3:32 PM
ATED:
DATE MOD 5/11/2017 1:08 PM
IFIED:
88. The § 222 deduction for tuition and related expenses is available:
a. Only if the taxpayer itemizes deductions from AGI.
b. To deduct that portion of the tuition in excess of that allowed under the lifetime learning credit.
c. To cover the tuition of a son who does not qualify as taxpayer’s dependent.
d. Only if job related.
e. None of these.
ANSWER: e
RATIONAL The § 222 deduction is a deduction for AGI (choice a.). The deduction is not available when the lifetime
E: learning credit is used (choice b.). The student involved is not a dependent of the taxpayer (choice c.). The
education need not be job related (choice d.).
POINTS: 1
DIFFICULT Easy
Y:
TYPE:
HAS VARI False
ABLES:
OBJECTIV
ES:
STANDAR
DS:

S:
OTHER: Time: 2 min.
DATE CRE 11/28/2016 3:32 PM
ATED:
DATE MOD5/11/2017 1:08 PM
IFIED:
89. The § 222 deduction for tuition and related expenses is available:
a. Regardless of the amount of a taxpayer’s MAGI.
b. To cover room and board expenses to attend college.
c. To a married taxpayer filing a separate return.
d. Even if a taxpayer does claim the standard deduction.
e. None of these.
ANSWE d
R:
RATION No deduction at all is allowed if the taxpayer has AGI in excess of $80,000 ($160,000 in the case of a joint
ALE: return) (choice a.). Section 222 does not cover room and board (choice b.). In order to claim a deduction under §
222, a married taxpayer must file a joint return (choice c.). Since § 222 provides for a deduction for AGI, it does
not matter if a taxpayer claims the standard deduction.
POINTS 1
:
DIFFIC Easy
ULTY:
ON TYP
E:
HAS VA False
RIABLE
S:
NG OBJ
ECTIVE
S:
AL STA
NDARD
S:
STATE United States - AK - AICPA: FN-Measurement -
STAND AICPA: FN-Measurement
ARDS:
RDS:
OTHER: Time: 5 min.
DATE C 11/28/2016 3:32 PM

REATE
D:
DATE M 5/11/2017 1:08 PM
ODIFIE
D:
90. Which, if any, of the following is subject to a cutback adjustment?
a. An airline pilot for an executive jet rental company who pays his own travel expenses.
b. Meals provided at cost to employees by a cafeteria funded by the employer.
c. Fourth of July company picnic for employees.
d. A trip to Bermuda awarded to the company’s top salesperson.
e. None of these.
ANSWER: a
RATIONALE: Although a reduced rate is in effect, the cutback adjustment still applies to persons subject to
regulation by the U.S. Department of Transportation.
POINTS: 1
DIFFICULTY: Easy

CTIVES:
DARDS:
OTHER: Time: 5 min.
91. Robert entertains several of his key clients on January 1 of the current year. Expenses paid by Robert are as follows:
Cab fare $ 60
Cover charge at supper club 200
Dinner at club 800
Tips to waiter 160
Presuming proper substantiation, Robert’s deduction is:
a. $610.
b. $640.
c. $740.
d. $1,220.
e. None of these.
ANSWER: b
RATIONALE: $60 + [50% × ($200 + $800 + $160)] = $640.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 5 min.
92. Tracy, the regional sales director for a manufacturer of exercise equipment, pays $2,500 to rent a skybox for a visiting
performance of the Harlem Globetrotters. The skybox holds 10 seats, and Tracy invites 7 clients to the event. Nonluxury
seats range in price from $80 to $120. The refreshments provided during the event cost $600. If Tracy meets all of the
requirements for deductibility (i.e., business discussion, substantiation), she may deduct:
a. $900.
b. $1,100.
c. $1,260.
d. $1,500.
e. $1,550.
ANSWER: a
RATIONALE: 50% × [(10 × $120) + $600] = $900.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 5 min.
93. Ralph made the following business gifts during the year.
To Robert (a key client) at Christmas $50
To Angel (Robert’s 8-year old daughter) on her birthday 20
To Art (Ralph’s secretary) on his birthday ($3 was for gift wrapping) 30
To Paige (Ralph’s boss) at Christmas 40
Presuming proper substantiation, Ralph’s deduction is:
a. $0.
b. $53.
c. $73.
d. $78.
e. $98.
ANSWER: b
RATIONALE: $25 (Robert) + $28 (Art) = $53. The gift to Angel counts as a gift to Robert (whose $25 limit already
has been reached). Gifts to superiors (Paige) cannot be deducted.
POINTS: 1
DIFFICULTY: Easy
E:
HAS VARIABLE False
S:
ECTIVES:
NDARDS:
OTHER: Time: 5 min.
DATE CREATED11/28/2016 3:32 PM
:
D:
94. Which, if any, of the following is an advantage of using the simplified method for determining the office in the home
deduction?
a. No depreciation on the personal residence has to be computed.
b. The exclusive use requirement does not have to be met.
c. Allows the expense to be classified as a deduction for AGI.
d. Can also be used for a residence that is rented (not owned) by the taxpayer.
e. None of these.
ANSWE a
R:
RATION The exclusive use requirement (choice b.) always has to be met for an office in the home deduction to
ALE: be available. The method chosen for arriving at the deduction has no relevance to how it is classified
(i.e., deduction for or from AGI)--choice c. Either the simplified method or the regular method can be
used for rented property (choice d.).
POINTS 1
:
DIFFIC Easy
ULTY:
ON TYP
E:
HAS VA False
RIABLE
S:
NG OBJ
ECTIVE
S:
AL STA
NDARD
S:
ARDS:
RDS:
OTHER: Time: 5 min.
DATE C 11/28/2016 3:32 PM

REATE
D:
DATE M 5/11/2017 1:08 PM
ODIFIE
D:
95. Which of the following expenses, if any, qualify as deductible?
a. Contributions to a Coverdell Education Savings Account (CESA).
b. Contributions to a qualified tuition program (§ 529 plan).
c. Job hunting expense of FBI agent who applies for the job of city manager of Beaumont (TX).
d. Contribution to a traditional IRA.
e. None of these.
ANSWER d
:
RATIONA Although the benefits paid out are nontaxable, neither the contribution to CESAs (choice a.) nor § 529 plans
LE: (choice b.) are deductible. Since being an FBI agent and a city manager do not appear to be in the same trade
or business (law enforcement), the job hunting expense does not qualify (choice c.).
POINTS: 1
DIFFICUL Easy
TY:
N TYPE:
HAS VAR False
IABLES:
G OBJEC CMPV.SWFT.LO: 9-07 - LO: 9-07
TIVES: CMPV.SWFT.LO: 9-08 - LO: 9-08
L STAND
ARDS:
TANDAR
DS:
KEYWOR Bloom's: Comprehension
DS:
OTHER: Time: 5 min.
DATE CR 11/28/2016 3:32 PM
EATED:
DATE M 5/11/2017 1:08 PM
ODIFIED:
96. Which, if any, of the following expenses is subject to the 2%-of-AGI floor?
a. Qualified tuition expenses under § 222.
b. Contribution to traditional IRA.
c. Cost of a CPA exam review course—taxpayer just began employment with an accounting firm.
d. Office in the home deduction for a self-employed taxpayer.
e. None of these.
ANSWER: e
RATIONALE: Choices a., b., and d. are deductions for AGI. Choice c. is not deductible.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 2 min.
97. Which, if any, of the following expenses is subject to the 2%-of-AGI floor?
a. Gambling losses (to the extent of gambling gains).
b. Moving expenses (not reimbursed by employer).
c. Teaching supplies (in excess of $250) purchased by a fifth grade teacher.
d. Union dues of self-employed machinist.
e. None of these.
ANSWER: c
RATIONA Moving expenses and teaching supplies (up to $250) are deductions for AGI (choice b.). Likewise, the union
LE: dues of a self-employed taxpayer are classified as a deduction for AGI. Gambling losses are miscellaneous
itemized deductions but are not subject to the 2% adjustment (choice a.).
POINTS: 1
DIFFICUL Easy
TY:
N TYPE:
HAS VARI False
ABLES:
G OBJEC
TIVES:
L STAND
ARDS:
TANDAR
DS:
DS:
OTHER: Time: 2 min.
DATE CR 11/28/2016 3:32 PM
EATED:
DATE MO 5/11/2017 1:08 PM
DIFIED:
98. Which, if any, of the following expenses are not subject to the 2%-of-AGI floor?
a. Safety shoes purchased by an plumber employed by a company.
b. Reimbursed employee expenses. Taxpayer-employee renders an adequate accounting to the employer.
c. Unreimbursed employee expenses.
d. Tax return preparation fee paid by a non-employed retiree.
e. None of these.
ANSWER: b
RATIONALE: Being employed, all job-related expenses are deductions from AGI (choice a.). All employee expenses,
unless reimbursed pursuant to an adequate accounting, are subject to the 2%-of-AGI floor (choices a. and
c.).
POINTS: 1
DIFFICULTY: Easy
QUESTION T Multiple Choice

YPE:
HAS VARIAB False
LES:
BJECTIVES: CMPV.SWFT.LO: 9-10 - LO: 9-10

TANDARDS:

OTHER: Time: 5 min.

DATE CREA 11/28/2016 3:32 PM
TED:
DATE MODIF 5/11/2017 1:08 PM
IED:
99. In contrasting the reporting procedures of employees and self-employed persons regarding job-related transactions,
which of the following items involve self-employed?
a. Schedule C of Form 1040.
b. Form 2106.
c. Form W-2.
d. Schedule A of Form 1040.
e. None of these.
ANSWE a
R:
RATION Form 2106 is used by those employees who do not account to their employer(s) or are not wholly reimbursed
ALE: (choice b.). Schedule C is used to list the job-related income and expenses of self-employed taxpayers (choice
a.). Form W-2 reports the wages earned by employees (choice c.). Income earned by self-employed persons is
often shown on Form 1099. The results of Form 2106 (see choice b.) are transferred to Schedule A (choice d.)
POINTS 1
:
DIFFIC Easy
ULTY:
ON TYP
E:
HAS VA False
RIABLE
S:
ECTIVE
S:
AL STA
NDARD
S:
ARDS:
KEYWO Bloom's: Knowledge
RDS:
OTHER: Time: 3 min.
DATE C 11/28/2016 3:32 PM

REATE
D:
DATE M 5/11/2017 1:08 PM
ODIFIE
D:
100. One of the tax advantages of being self-employed (rather than being an employee) is:
a. The self-employment tax is lower than the Social Security tax.
b. The cutback adjustment does not apply.
c. The actual cost method for deducting the business use of an automobile can be selected.
d. Job-related expenses are deductions for AGI.
e. A deduction for an office in the home is available.
ANSWE d
R:
RATION The self-employment tax is double what the employee pays (choice a.). The cutback adjustment also applies to
ALE: self-employed taxpayers (choice b.). Job-related expenses are reported on Schedule C (rather than Schedule A)
which results in deduction-for-AGI treatment (choice d.). The actual cost method and the deduction for office in
the home are equally available to both employees and self-employed persons (choices c. and e.).
POINTS 1
:
DIFFIC Easy
ULTY:
ON TYP
E:
HAS VA False
RIABLE
S:
ECTIVE
S:
AL STA
NDARD
S:
ARDS:
KEYWO Bloom's: Knowledge
RDS:
OTHER: Time: 3 min.
DATE C 11/28/2016 3:32 PM

REATE
D:
DATE M 5/11/2017 1:08 PM
ODIFIE
D:
101. Meredith holds two jobs and attends graduate school on weekends. The education improves her skills, but does not
qualify her for a new trade of business. Before going to the second job, she returns home for dinner. Relevant mileage is
as follows:
Home to first job 9 miles

First job to second job 13 miles
Home to second job 15 miles
Home to university 7 miles
How much of the mileage qualifies for deduction purposes?

ANSWER: 27 miles. The mileage from the first job to the second job, 13 miles, qualifies. Also, round trip mileage to
the university (14 miles) can be claimed if the education Meredith is obtaining is deductible.
POINTS: 1
DIFFICULTY: Easy
QUESTION T Subjective Short Answer
YPE:
HAS VARIABL False
ES:
BJECTIVES:
ANDARDS:
OTHER: Time: 5 min.

DATE CREAT 11/28/2016 3:32 PM
ED:
ED:
102. Paul is employed as an auditor by a CPA firm. On most days, he commutes by auto from his home to the office.
During one month, however, he has an extensive audit assignment closer to home. For this engagement, Paul drives
directly from home to the client’s premises and back. Mileage information is summarized below:
Home to office 12 miles
Office to audit client 15 miles
Audit client to home 10 miles
If Paul spends 20 days on the audit, what is his deductible mileage?
ANSWER: 400 miles [20 miles (each day) × 20 days].
POINTS: 1
DIFFICULTY: Easy
QUESTION TYPE: Subjective Short Answer
OTHER: Time: 5 min.
103. During 2017, Eva used her car as follows: 12,000 miles (business), 1,400 miles (commuting), and 4,000 miles
(personal). In addition, she spent $440 for tolls (business) and $620 for parking (business). If Eva uses the automatic
mileage method, what is the amount of her deduction?
ANSWER: $7.480. (12,000 miles × $0.535) + $440 + $620 = $7,480.
POINTS: 1
DIFFICULTY: Easy
OTHER: Time: 5 min.
104. Elsie lives and works in Detroit. She is the regional sales manager for a national fast-food chain. Due to unusual
developments, she is compelled to work six straight weeks in the Cleveland area. Instead of spending the weekend there,
she flies home every Friday night and returns early Monday morning. The cost of coming home for the weekend
approximates $600. Had she stayed in Cleveland, deductible meals and lodging would have been $700. How much, if any,
may Elsie deduct as to each weekend?
ANSWER: $600 for each weekend, the lesser of the $600 cost of returning home or the $700 cost of
staying in Cleveland.
POINTS: 1
DIFFICULTY: Easy
ES:
NATIONAL STANDARDUnited States - BUSPORG: Comprehension - BUSPORG:Comprehension
S:
OTHER: Time: 5 min.
105. Alfredo, a self-employed patent attorney, flew from his home in Chicago to Miami, had lunch alone at the airport,
conducted business in the afternoon, and returned to Chicago in the evening. His expenses were as follows:
Airfare $900
Airport parking (Chicago) 60
Lunch 30
Taxis (Miami) 42
What is Alfredo’s deductible expense for the trip?
ANSWER: $1,002 ($900 + $60 + $42). As Alfredo was not away from home, his lunch is not
deductible.
POINTS: 1
DIFFICULTY: Easy

OTHER: Time: 5 min.
106. Rod uses his automobile for both business and personal use and claims the automatic mileage rate for all purposes.
During 2017, his mileage was as follows:
Miles Driven
Personal 4,000
Business 8,000
Qualifying moving expense 3,500
Medical 1,800
Charitable 1,500
Qualifying education (MBA program) 800
How much can Rod claim for mileage?

ANSWER: $5,819 [(8,800 miles × $0.535, business and education) + (3,500 miles × $0.17, moving) + (1,800
miles × $0.17, medical) + (1,500 miles × $0.14, charitable)].
POINTS: 1
DIFFICULTY: Easy
QUESTION TYP Subjective Short Answer
E:
HAS VARIABLES False
:
LEARNING OBJECMPV.SWFT.LO: 9-02 - LO: 9-02
CTIVES:
DARDS:
OTHER: Time: 5 min.

:
107. Lily went from her office in Portland to Lisbon, Portugal on business. While there, she spent part of the time on
vacation. How much of the air fare of $5,000 can she deduct based on the following assumptions:
a. Lily was gone five days (i.e., three business and two personal).
b. Lily was gone five weeks (i.e., four business and one personal).
c. Lily was gone five weeks (i.e., three business and two personal).
ANSWE a. $5,000.
R: b. $5,000.
c. $3,000. (60% × $5,000).
Transportation costs for mixed use (i.e., both business and personal) need not be allocated as long as domestic
trips are involved. Such allocation is necessary, however, for foreign trips unless one of two exceptions applies.
One exception deals with trips lasting seven days or less and covers part a. (but not part b. or part c.) above. The
second exception, less than 25% of the time was for personal use, applies to part b. but not to part c. Thus, in
part b. no allocation is necessary, while in part c. the air fare must be allocated.
POINTS 1
:
DIFFIC Moderate
ULTY:
QUESTI Subjective Short Answer
ON TYP
E:
HAS VA False
RIABLE
S:
NG OBJ
ECTIVE
S:
AL STA
NDARD
S:
ARDS:
RDS:
DATE C 11/28/2016 3:32 PM

REATE
D:
DATE M 5/11/2017 1:08 PM
ODIFIE
D:
108. Noah moved from Delaware to Arizona to accept a better job. He incurred the following unreimbursed moving
expenses:
Transportation $3,000
Lodging 400
Meals in route 500
Penalty for breaking apartment lease 1,000
Forfeiture of athletic club membership 500
Moving company cost 7,000
What is Noah’s moving expense deduction?
ANSWER: $10,400 ($3,000 + $400 + $7,000). Meals ($500), lease penalty ($1,000), and membership forfeiture
($500) are not qualifying moving expenses.
POINTS: 1

CTIVES:
NATIONAL STANDUnited States - BUSPORG: Comprehension - BUSPORG:Comprehension
ARDS:
109. After graduating from college, Clint obtained employment in Omaha. In moving from his parents’ home in Baltimore
to Omaha, Clint incurred the following expenses:
Transportation $ 700
Meals 380
Lodging 400
Cost of moving household goods 3,500
a. How much may Clint deduct as moving expense?
b. Would any deduction be allowed if Clint claimed the standard deduction for the year of the
move? Explain.
ANSWER: a. $4,600 ($700 + $400 + $3,500). No deduction is allowed for meals.
b. Yes. Moving expenses are deductions for AGI and can be claimed regardless of
whether a taxpayer takes the standard deduction or chooses to itemize.
POINTS: 1

110. Arnold is employed as an assistant manager in the furniture division of a national chain of department stores. He is a
recent college graduate with a degree in marketing. During 2017, he enrolls in the evening MBA program of a local
university and incurs the following expenses: tuition, $4,200; books and computer supplies, $800; transportation expense
to and from the university, $450; and meals while on campus, $400. Arnold is single and his annual AGI is $64,000. As to
these expenses, what are Arnold’s:
a. Deductions for AGI?
b. Deductions from AGI?

ANSWER:
a. $4,000. Although the tuition was $4,200, § 222 imposes a limitation of $4,000.
b. $1,450. $200 (excess tuition not allowed under § 222) + $800 (books and computer
supplies) + $450 (transportation) = $1,450. No deduction is allowed for meals, since
Arnold is not in travel status. Further adjustment will be required due to the 2%-of-AGI
limitation on certain itemized deductions.
POINTS: 1
:

111. Cathy takes five key clients to a nightclub and incurs the following costs: $320 limousine rental, $460 cover charge,
$920 drinks and dinner, and $200 tips. Several days after the function, Cathy mails each client a pen costing $25. In
addition, Cathy pays $4 for gift wrapping and mailing each pen. Assuming adequate substantiation and a business
justification, what is Cathy’s deduction?
ANSWER: $1,255. $320 + [($460 + $920 + $200) × 50%] = $1,110. Also allowed are the gifts of $145 (5 × $29). The
cost of gift wrapping and mailing each pen ($4) can be added to the maximum amount of gift allowed
($25).
POINTS: 1
QUESTION T Subjective Short Answer

YPE:
HAS VARIAB False
LES:
LEARNING OCMPV.SWFT.LO: 9-06 - LO: 9-06
BJECTIVES:

TANDARDS:
STATE STANUnited States - AK - AICPA: FN-Measurement -


DATE CREA 11/28/2016 3:32 PM
TED:
DATE MODIF5/11/2017 1:08 PM
IED:
112. For the current football season, Tern Corporation pays $40,000 for a skybox (containing 12 seats) at Veterans
Stadium for eight home games. Regular nonskybox seats at each game range from $120 to $150 a seat. In November, a
Tern employee and ten clients use the skybox to attend a game. The event is preceded by a bona fide business discussion,
and Tern spent $1,000 for food and drinks during the game. What is Tern’s deduction?
ANSWER: $1,400. (12 seats × $150) + $1,000 = $2,800 × 50% (cutback adjustment) = $1,400. Even though only ten
clients attended, all available seats are considered. The highest cost of a regular seat ($150) is used in the
computation.
POINTS: 1
DIFFICULTY Easy
:
QUESTION Subjective Short Answer
TYPE:
HAS VARIA False
BLES:
OBJECTIVE
S:
NATIONAL SUnited States - BUSPORG: Comprehension - BUSPORG:Comprehension
TANDARDS:

:
OTHER: Time: 5 min.
DATE CREA 11/28/2016 3:32 PM
TED:
DATE MODI 5/11/2017 1:08 PM
FIED:
113. Brian makes gifts as follows:
Recipient Cost of Gift

Mr. Brown (a client) $27 *
Mrs. Brown (Mr. Brown’s wife) 15
Ms. Smith (Brian’s receptionist) 30
Mr. Jones (Brian’s boss) 40
* Includes $2 for gift wrapping

Presuming adequate substantiation and no reimbursement, how much may Brian deduct?
ANSWE $52 ($27 + $25). The deduction for Mr. Brown’s gift can include nominal costs for gift-wrapping and engraving.
R: No deduction is allowed for the gift to Mrs. Brown unless she is in a separate business. Otherwise, she falls
under the $25 limit applicable to Mr. Brown. The deduction for Ms. Smith’s gift is limited to $25. No deduction
is allowed for Brian’s gift to his boss.
POINTS 1
:
DIFFIC Easy
ULTY:
ON TYP
E:
HAS VA False
RIABLE
S:
NG OBJ
ECTIVE
S:
AL STA
NDARD
S:
ARDS:
RDS:
OTHER: Time: 5 min.
DATE C 11/28/2016 3:32 PM

REATE
D:
DATE M 5/11/2017 1:08 PM
ODIFIE
D:
114. In the current year, Bo accepted employment with a Kansas City law firm after graduating from law school. Her
expenses for the year are listed below:
Cost of bar review course $1,500
Qualified moving expenses 2,100
Job hunting expenses 1,800
Subscriptions to legal journals 450
Membership dues in bar associations 620
State bar dues 300
Since Bo worked just part of the year, her salary was only $32,100. In terms of deductions from AGI, how much does Bo
have?
ANSWE $770. AGI is $30,000 [$32,100 (salary) – $2,100 (moving expenses)]. Thus, the 2%-of-AGI floor is $600
R: ($30,000 × 2%). Qualifying itemized deductions are $1,370 ($450 + $620 + $300). Thus, $1,370 – $600 = $770
is the allowable itemized deduction. No deduction is allowed for the bar review course and the job hunting
expenses. In this case, it is apparent that Bo should claim the standard deduction and not itemize.
POINTS 1
:
DIFFIC Moderate
ULTY:
ON TYP
E:
HAS VA False
RIABLE
S:
ECTIVE CMPV.SWFT.LO: 9-10 - LO: 9-10
S:
AL STA
NDARD
S:
ARDS:
RDS:
DATE C 11/28/2016 3:32 PM

REATE
D:
DATE M 5/11/2017 1:08 PM
ODIFIE
D:
115. Rocky has a full-time job as an electrical engineer for the city utility. In his spare time, Rocky repairs TV sets in the
basement of his personal residence. Most of his business comes from friends and referrals from former customers,
although occasionally he runs an ad in the local suburbia newspaper. Typically, the sets are dropped off at Rocky’s house
and later picked up by the owner when notified that the repairs have been made.
The floor space of Rocky’s residence is 2,500 square feet, and he estimates that 20% of this is devoted exclusively to the
repair business (i.e., 500 square feet). Gross income from the business is $13,000, while expenses (other than home office)
are $5,000. Expenses relating to the residence are as follows:
Real property taxes $4,500

Interest on home mortgage 8,000
Operating expenses of residence 3,000
Depreciation (based on 20% business use) 1,000
What is Rocky’s net income from the repair business
a. If he uses the regular (actual expense) method of computing the deduction for office in the home?
b. If he uses the simplified method?
ANSWER: a. Business income $13,000
Less: Expenses (5,000)
Net business income before office in the home expenses $ 8,000
Less: Real property taxes ($4,500 (900)
× 20%)
Mortgage interest ($8,000 × (1,600)
20%)
Operating expenses($3,000 (600)
× 20%)
Depreciation (1,000)
Net income fro m business $ 3,900
Net business income before office in the home expense (see part a. $ 8,000
b.
above)
Office in the home expense (1,500) *
Net income from business $ 6,500
*As no more than 300 square feet can be considered, the maximum
allowed is $1,500 (300 square feet x $5).
POINTS: 1
LEARNING OBJECTIVCMPV.SWFT.LO: 9-07 - LO: 9-07
ES:
DS:
116. For the current year, Wilbur is employed as a deputy sheriff of a county. He has AGI of $50,000 and the following
unreimbursed employee expenses:
Attendance at a law enforcement conference ($800 for travel and $220 for meals) $1,020
Uniforms (does not include $300 for laundry and dry cleaning) 1,000
Professional dues and journals 300
Contribution to sheriff’s reelection campaign (highly recommended by Wilbur’s boss) 400
How much of these expenses are allowed as deductions from AGI?
ANSWER: $1,510. $910 + $1,300 + $300 = $2,510 – (2% × $50,000) = $1,510. A cutback adjustment of $110 ($220 ×
50%) is required for the meals obtained during the conference. No deduction is available for the campaign
contribution.
POINTS: 1
DIFFICULTY Moderate
:
QUESTION Subjective Short Answer
TYPE:
HAS VARIA False
BLES:
OBJECTIVE CMPV.SWFT.LO: 9-07 - LO: 9-07
S: CMPV.SWFT.LO: 9-10 - LO: 9-10
STANDARD
S:
:
DATE CREA 11/28/2016 3:32 PM
TED:
DATE MODI 5/11/2017 1:08 PM
FIED:
117. If a business retains someone to provide services, that person may either be an employee or be self-employed (i.e.,
independent contractor).
a. What are the tax advantages to the business of having the service provider classified as self-employed?
b. What are the advantages and disadvantages to the service provider of self-employed status?
ANSWER:
a. Self-employed persons do not have to be included in various fringe benefits programs
(e.g., group-term life insurance, accident and health plans) and retirement plans.
Because they are not covered by FICA and FUTA, these payroll costs are avoided.
The advantages are that expenses qualify as deductions for AGI. Consequently,
b. deductibility is not affected by the choice of the standard deduction, and no reduction is
required for the 2%-of-AGI floor. In terms of disadvantages, being self-employed can
lead to other state and local taxes (e.g., license fees, franchise taxes, occupation taxes,
gross receipts levy). The most significant, however, is the self-employment tax that the
taxpayer is subject to.
POINTS: 1
DIFFICULTY: Easy
QUESTION TYPE: Essay
:
NATIONAL STANDARDS: United States - BUSPROG: Technology: Technology: - BUSPROG: Technology

118. In terms of income tax treatment, what is the difference between common law and statutory employees?
ANSWER: Although subject to Social Security tax, statutory employees are not subject to Income tax withholding.
Statutory employees may claim all of their unreimbursed expenses as deductions for AGI. For common law
employees, such expenses are deductions from AGI.
POINTS: 1
DIFFICULT Easy
Y:
QUESTIO Essay
N TYPE:
HAS VARI False
ABLES:
OBJECTI
VES:
STANDAR
DS:
ANDARDS AICPA: FN-Measurement
:
DS:
OTHER: Time: 5 min.
DATE CRE 11/28/2016 3:32 PM
ATED:
DATE MO 5/11/2017 1:08 PM
DIFIED:
119. Myra’s classification of those who work for her as independent contractors is being questioned by the IRS. It is the
position of the IRS that these workers are really employees. What type of factors can Myra utilize to justify her
classification?
ANSWER: Myra needs to show that she has a reasonable basis for not treating her workers as employees. In this
regard, can she prove reliance on any of the following?
∙ Judicial precedent, published ruling, or technical advice.

∙ A past IRS audit that resulted in no employment tax assessment.
∙ A longstanding practice of independent contractor status in the same industry.
∙ Has Myra consistently treated these workers as independent contractors?
∙ Has she reported their earnings by filing Form 1099-MISC?
POINTS: 1
QUESTION TYPEEssay
:
HAS VARIABLES False
:
CTIVES:
DARDS:
STATE STANDA United States - AK - AICPA: FN-Reporting
RDS:
DATE MODIFIED:5/11/2017 1:08 PM

120. Taylor performs services for Jonathan on a regular basis. There exists considerable doubt as to whether Taylor is an
employee or an independent contractor.
a. What can Jonathan do to clarify the matter?
b. Suppose Jonathan treats Taylor as an independent contractor but Taylor thinks she is an
employee. What is Taylor’s recourse, if any?
ANSWER:
a. Jonathan can obtain a ruling from the IRS by filing Form SS–8 (Determination of
Worker Status for Purposes of Federal Employment Taxes and Income Tax
Withholding).
b. Taylor should file a Form 8919 (Uncollected Social Security and Medicare Tax on
Wages) with the IRS.
POINTS: 1
DIFFICULTY: Easy
: CMPV.SWFT.LO: 9-11 - LO: 9-11

OTHER: Time: 5 min.
121. Jacob is a landscape architect who works out of his home. He wonders whether or not he will have nondeductible
commuting expenses when he drives to the locations of his clients. Please comment.
ANSWER: Jacob has no commuting expenses since his tax home is his residence. Thus, his mileage to and from
the premises of his clients should be fully deductible.
POINTS: 1
DIFFICULTY: Easy
QUESTION TYPE Essay
:

CTIVES:
DARDS:
STATE STANDA United States - AK - AICPA: FN-Reporting
RDS:
OTHER: Time: 5 min.

122. Under the automatic mileage method, one rate does not cover every type of expense. For 2017, what are the rates for
business use, education, moving, charitable, and medical?
ANSWER: $0.535 (business use); $0.535 (education); $0.17 (moving); $0.14 (charitable); and $0.17
(medical).
POINTS: 1
DIFFICULTY: Easy
:
:
OTHER: Time: 5 min.
123. Christopher just purchased an automobile for $40,000 which he plans to claim 100% as being for business use. In
order to take advantage of MACRS and § 179, he plans to use the actual cost method for determining his deduction in the
first year. In subsequent years, he will switch to the automatic mileage method. Comment on Christopher’s proposed
approach.
ANSWE First, limitations are imposed on how much depreciation can be claimed over each year of the five-year write-off
R: period. In most cases, such limitations significantly reduce the depreciation normally allowed. Second, the use
of MACRS and/or § 179 precludes later converting to the automatic mileage method. Lastly, how many
automobiles does Christopher own? If just one, 100% business use could be almost impossible to justify since it
negates any personal use.
POINTS 1
:
DIFFIC Moderate
ULTY:
QUESTI Essay
ON TYP
E:
HAS VA False
RIABLE
S:
ECTIVE
S:
AL STA
NDARD
S:
STATE United States - AK - AICPA: FN-Reporting
STAND
ARDS:
RDS:
DATE C 11/28/2016 3:32 PM

REATE
D:
DATE M 5/11/2017 1:08 PM
ODIFIE
D:
124. Once set for a year, when might the IRS change the rate for the automatic mileage method?
ANSWER: Changes in the past have been justified by significant increases or decreases in fuel prices. Such a
change places a premium on keeping track of mileage on a monthly basis.
POINTS: 1
QUESTION TYP Essay
E:
HAS VARIABLE False
S:
ECTIVES:
NDARDS:
STATE STAND United States - AK - AICPA: FN-Reporting
ARDS:
OTHER: Time: 5 min.
D:
D:
125. Travel status requires that the taxpayer be away from home overnight.
a. What does “away from home overnight” mean?
b. What tax advantages result from being in travel status?
ANSWER: a. “Home” for this purpose is the place of taxpayer’s principal employment. “Overnight”
need not be a 24-hour period, but it must be a time duration substantially longer than
an ordinary day’s work such as to require rest or sleep.
b. If “travel status” exists, many otherwise nondeductible expenses (e.g., meals, lodging,
transportation) become deductible.
POINTS: 1

126. When is a taxpayer’s work assignment in a new locale temporary? Permanent? What difference does it make?
ANSWER: Temporary indicates that the assignment’s termination is expected within a reasonably short period of time. In
no event can the period of absence exceed one year. If the taxpayer’s assignment is indefinite, and not
temporary, his or her tax home changes and travel status ends.
POINTS: 1
DIFFICUL Moderate
TY:
QUESTIO Essay
N TYPE:
HAS VARI False
ABLES:
G OBJEC
TIVES:
L STANDA
RDS:
:
DS:
OTHER: Time: 5 min.
DATE CR 11/28/2016 3:32 PM
EATED:
DATE MO 5/11/2017 1:08 PM
DIFIED:
127. Nick Lee is a linebacker for the Baltimore Ravens (a professional football club). During the football season he rents
an apartment in a Baltimore suburb. The rest of the time he lives with his family in Ann Arbor (MI) and works at a local
bank as a vice president in charge of public relations. Can Nick deduct his expenses while away from Ann Arbor?
Explain.
ANSWE Probably not. Although his personal residence is in Ann Arbor, Nick’s tax home is likely to be the Baltimore
R: area. Considering the salaries of professional football players, Nick’s income from the Ravens must heavily
outweigh that received from an Ann Arbor bank. Furthermore, his principal activity and the time spent (e.g.,
conditioning, training, playing) is that of a player and not a banker.
POINTS 1
:
DIFFIC Moderate
ULTY:
QUESTI Essay
ON TYP
E:
HAS VA False
RIABLE
S:
NG OBJ
ECTIVE
S:
AL STA
NDARD
S:
STAND
ARDS:
RDS:
DATE C 11/28/2016 3:32 PM

REATE
D:
DATE M 5/11/2017 1:08 PM
ODIFIE
D:
128. How are combined business/pleasure trips treated for travel within the United States as opposed to foreign travel?
ANSWE The major difference is that transportation charges are fully deductible if the trip is primarily for business and
R: within the United States. If the foreign trip is primarily business, transportation expenses must be allocated
between business and personal unless (1) the taxpayer was away from home for seven days or less or (2) if less
than 25% of the time was spent on personal pursuits.
POINTS 1
:
DIFFIC Easy
ULTY:
QUESTI Essay
ON TYP
E:
HAS VA False
RIABLE
S:
NG OBJ
ECTIVE
S:
AL STA
NDARD
S:
ARDS:
RDS:
DATE C 11/28/2016 3:32 PM

REATE
D:
DATE M 5/11/2017 1:08 PM
ODIFIE
D:
129. Concerning the deduction for moving expenses, what circumstances, if any, will excuse a taxpayer from meeting the
time test of 39 or 78 weeks?
ANSWER: The time test will be disregarded if the taxpayer dies, becomes disabled, or is discharged (other than for
willful misconduct) or transferred by the new employer. Under certain conditions, expatriates who retire
while overseas are exempt from the time test.
POINTS: 1
DIFFICULT Easy
Y:
QUESTION Essay
TYPE:
HAS VARIAFalse
BLES:
OBJECTIV
ES:
STANDAR
DS:

S:
OTHER: Time: 5 min.
DATE CRE 11/28/2016 3:32 PM
ATED:
DATE MOD 5/11/2017 1:08 PM
IFIED:
130. A taxpayer just changed jobs and incurred unreimbursed moving expenses.
a. What are his (or her) options if an income tax return has to be filed before the time test is
met?
b. What happens if the moving expense deduction has been claimed and the time test is not
later satisfied?
ANSWER:
a. The taxpayer may claim the deduction right away or wait until the time test is met and
file an amended return for the year of the move.
b. If the moving expense is claimed and the time test is not later met, a taxpayer has two
options. First, he can increase the income for the following year by the amount of the
deduction claimed. Second, he can file an amended return for the year of the move in
which the deduction is not claimed.
POINTS: 1
:

131. Nicole just retired as a partner in a Philadelphia law firm. She moved to San Francisco where she took a job as an
adjunct professor at a local law school. Can Nicole deduct her moving expenses? Explain
ANSWER: She can deduct her moving expenses if her status as an adjunct professor is full-time employment. She
cannot if her status is regarded as part-time employment.
POINTS: 1
DIFFICULTY: Easy
QUESTION TYP Essay
E:
HAS VARIABLES False
:
ECTIVES: CMPV.SWFT.LO: 9-11 - LO: 9-11
NATIONAL STANUnited States - BUSPORG: Comprehension - BUSPORG:Comprehension
DARDS:
DATE CREATED 11/28/2016 3:32 PM
:
:
132. In terms of IRS attitude, what do the following expenses have in common?
a. Cost of a CPA exam review course.
b. Cost of a review course for the bar exam.
c. Cost of a law degree by a taxpayer who does not intend to practice law.
ANSWER: a. It is the position of the IRS that the costs associated with becoming a CPA are incurred
in order to acquire a basic skill and thus are not deductible as education expenses.
b. The same reasoning as noted in part a. above applies to review course taken to pass the
bar exam.
c. Regardless of a taxpayer’s career goals, the IRS considers a law degree to be the
acquisition of a basic skill.
POINTS: 1
DIFFICULTY: Easy

133. Madison and Christopher are staff accountants at a major public accounting firm. Both are pursuing a law degree in a
night program at local law school. Madison contends that the cost of the program is a deduction for income tax purposes,
while Christopher maintains that it is not. Who is correct and why?
ANSWE Both are partly correct and incorrect. The IRS takes the position that pursuing a law degree is not maintaining or
R: improving existing skills but results in acquiring a new job skill. Thus, a legal education is not job related to
accounting but constitutes a new trade or business. However, § 222 allows a deduction for tuition (up to $4,000
or less) even if the education is not job related. This provision allows some or all of the law school tuition to be
deductible but not other associated expenses (e.g., textbooks, transportation). In summary, some costs can be
claimed and some cannot.
POINTS 1
:
DIFFIC Easy
ULTY:
QUESTI Essay
ON TYP
E:
HAS VA False
RIABLE
S:
NG OBJ
ECTIVE
S:
NATION United States - BUSPROG: Technology: Technology: - BUSPROG: Technology
AL STA
NDARD
S:
ARDS:
KEYWO Bloom's: Analysis
RDS:
DATE C 11/28/2016 3:32 PM

REATE
D:
DATE M 5/11/2017 1:08 PM
ODIFIE
D:
134. Logan, Caden, and Olivia are three unrelated parties who claim the standard deduction. All are married and attend
Citron University and each pays tuition of $6,100. Of this payment, Logan can claim a deduction of $4,000; Caden a
deduction of $2,000; and Olivia no deduction at all. Explain.
ANSWER: The most apparent explanation is the limitation imposed on the § 222 tuition deduction. Logan’s MAGI must
be less than $130,000, while Caden’s MAGI is more than $130,000 but not more than $160,000. Lastly,
Olivia’s MAGI must be in excess of $160,000.
POINTS: 1
DIFFICULT Easy
Y:
QUESTIONEssay
TYPE:
HAS VARI False
ABLES:
OBJECTIV
ES:
NATIONAL United States - BUSPROG: Technology: Technology: - BUSPROG: Technology
STANDAR
DS:

S:
DATE CRE 11/28/2016 3:32 PM
ATED:
DATE MO 5/11/2017 1:08 PM
DIFIED:
135. Meg teaches the fifth grade at a local school. During the year, she spends $1,200 for school supplies for use in her
classroom. On her income tax return, some of this expense is not reported and the balance is deducted in two different
places. Explain what has probably happened.
ANSWE Meg probably has been reimbursed for some of these expenses. If she renders an adequate accounting to her
R: employer, the reimbursement is not reported in her income nor is the expense involved deducted. As to the
remaining expenses, she has claimed $250 as a deduction for AGI and the balance as a miscellaneous itemized
deduction.
POINTS: 1
DIFFICU Moderate
LTY:
QUESTI Essay
ON TYP
E:
HAS VA False
RIABLE
S:
NG OBJ
ECTIVE
S:
AL STA
NDARD
S:
STANDA AICPA: FN-Measurement
RDS:
RDS:
DATE C 11/28/2016 3:32 PM

REATED
:
DATE M 5/11/2017 1:08 PM
ODIFIED
:
136. In connection with the office in the home deduction, comment on the following:
a. Mixed use (i.e., business and personal) of the portion of the home allocated to business.
b. The difference between direct and indirect expenses for deduction purposes.
c. The classification of the expense (i.e., dfor or dfrom AGI).

ANSWER:
a. In most cases, mixed use of the portion allocated to business is not allowed.
Consequently, the office must be exclusively used for business. An exception is made,
however, when the home is used as a daycare center. Here, mixed use is allowed.
b. Direct expenses (e.g., painting the office) are deductible in full because they only
benefit the office area. Indirect expenses (e.g., homeowners casualty insurance) must
be allocated since they relate to both the business and personal portions of the home. In
the case of the simplified method of determining the deduction, the distinction between
direct and indirect expenses is not relevant.
c. Like most job-related expenses, the taxpayer’s status (i.e., employed, self-employed)
governs the classification of the expense. Thus, an office in the home expense to an
employee is a deduction from AGI, while that of a self-employed taxpayer is a
deduction for AGI.
POINTS: 1

137. Regarding the new simplified method of computing the office in the home deduction, comment on the following
independent factors.
a. Taxpayer has set aside 400 square feet for use as an office.
b. Taxpayer has repainted and recarpeted the office area.
c. In past years, taxpayer has always taken the deduction using the regular (actual expense) method.
d. The net income from the business is not large.
ANSWER:
a
Unfortunately, the deduction is limited to 300 square feet--so the maximum allowed is $1,500 (300 ×
.
$5).
b
Direct expenses cannot be claimed under this method.
.
c As the choice allowed is annual, the method used in the past does not matter. However, no carry over of
. unused deduction can be claimed. Also, a prior choice cannot be changed but is binding on the
taxpayer.
d The deduction cannot exceed the net income from the property. Furthermore, any unused deduction
. amount cannot be carried over to future years.
POINTS: 1
QUESTION T Essay
YPE:
HAS VARIAB False
LES:
BJECTIVES:
DATE CREA 11/28/2016 3:32 PM

TED:
DATE MODIF 5/11/2017 1:08 PM
IED:
138. Faith just graduated from college and she needs advice on the tax treatment of the costs she incurs in connection with
her first job (a sales person for a pharmaceutical company). Specifically, she wants to know about the following items:
a. Job search costs.
b. Business wardrobe cost.
c. Moving expenses.
d. Deduction for office in the home.

ANSWER:
a. Not deductible as it involves Faith’s first job.
b. Not deductible since the clothes are suitable for street wear.
c. As long as the time and distance requirements are met, the moving expenses are
deductible.
Unless Faith’s employer has an office available for her in the locale where she works,
d.
she can qualify for an office in the home deduction. This result is consistent with the
convenience of the employer requirement applicable in the case of
employees. Because she is just starting, Faith will probably rent and not buy a
residence. As a renter, she will not have many indirect expenses attributable to an
office (e.g., property taxes, interest on home mortgage). Consequently, Faith might
wish to choose the simplified method of determining the office in the home expense.
POINTS: 1
DIFFICULTY: Easy
: CMPV.SWFT.LO: 9-07 - LO: 9-07

139. Regarding tax favored retirement plans for employees and self-employed persons, comment on the following:
a. The exclusion versus deduction approaches as to contributions by participants.
b. Tax-free accumulation of earnings.
c. The deferral of income tax consequences.
d. Employee versus self-employed status.
ANSWER: a. Contributions by employees to retirement plans that are qualified provide a tax benefit
either in the form of an exclusion from gross income or as a deduction for AGI. The
traditional IRA takes the deduction approach. This is also the case of contributions by a
self-employed person to a Keogh (H.R. 10) plan.
b. A characteristic of all tax-favored retirement plans is that income accumulates free of

tax. This allows for a greater accumulation to take place up to the point of distribution.
c. Except in the Roth IRA, the main objective of retirement plans is to defer taxation until
distributions are made.
d. Keogh (H.R. 10) plans are, in effect, the self-employed version of employee retirement
plans.
POINTS: 1

140. Ashley and Matthew are husband and wife and both are practicing CPAs. On a joint return, Ashley gets to deduct her
professional dues but Matthew does not. Explain.
ANSWER Most likely Ashley is self-employed, while Matthew is employed. Thus, Ashley’s expenses are deductions for
: AGI and Matthew’s are itemized deduction subject to the 2% floor. If they do not itemize (or if they do and
cannot exceed the 2% floor), Matthew loses the deduction for his professional dues.
POINTS: 1
DIFFICUL Moderate
TY:
QUESTIO Essay
N TYPE:
HAS VAR False
IABLES:
G OBJEC CMPV.SWFT.LO: 9-10 - LO: 9-10
TIVES:
L STAND
ARDS:
STATE S United States - AK - AICPA: FN-Measurement -
TANDAR AICPA: FN-Measurement
DS:
DS:
OTHER: Time: 5 min.
DATE CR 11/28/2016 3:32 PM
EATED:
DATE MO5/11/2017 1:08 PM
DIFIED:
141. Isabella is a dental hygienist who works for five different dentists. She spends one day a week (i.e., Monday through
Friday) with each. All of the dentists except Dr. Stanki (the Wednesday assignment) treat her as an employee. Dr. Stanki,
however, classifies her as being self-employed. Comment on this discrepancy in treatment.
ANSWE Unless Isabella’s Wednesday duties are significantly different than the rest of the week, Dr. Stanki has placed
R: himself in a vulnerable position. In terms of the proper work classification of a service provider, one key
consideration is how they are treated by other comparable businesses. In all likelihood, therefore, Dr. Stanki will
have a tough time convincing the IRS that Isabella is an independent contractor when four of his colleagues
consider her to be an employee. More likely, Dr. Stanki desires to save on payroll taxes and avoid covering
Isabella in any fringe benefits offered to other employees.
POINTS 1
:
DIFFIC Easy
ULTY:
QUESTI Essay
ON TYP
E:
HAS VA False
RIABLE
S:
NG OBJ
ECTIVE
S:
AL STA
NDARD
S:
STAND
ARDS:
RDS:
DATE C 11/28/2016 3:32 PM

REATE
D:
DATE M 5/11/2017 1:08 PM
ODIFIE
D:
142. Felicia, a recent college graduate, is employed as an accountant by an oil company. She would like to continue her
education and obtain a law degree. Discuss Felicia’s tax status if she attends a local law school on a:
a. Part-time basis.
b. Full-time basis.
ANSWER: Regarding the usual education expense justification of maintaining and improving on
a. existing skills, Felicia will not succeed. The IRS has successfully maintained that
obtaining a law degree leads to a new trade or business. Reliance on § 222, however, is
appropriate since the education need not be job related. Unfortunately, § 222 only
covers tuition, is limited to $4,000, and may be reduced (or eliminated) by an AGI
limitation.
b. If Felicia quits her job and returns to college on a full-time basis, she no longer is in a
trade or business. A temporary break in employment status (e.g., leave of absence),
however, will cure this problem if properly structured. However, Felicia will still
encounter the new trade or business provision.
POINTS: 1

143. Discuss the 2%-of-AGI floor and the 50% cutback limitation in connection with various employee expenses under
the following arrangements:
a. The employee is not reimbursed by the employer.
b. The employee is fully reimbursed under a nonaccountable plan.
c. The employee is partially reimbursed under an accountable plan.
d. The employee is fully reimbursed under an accountable plan.
ANSWER:
Any cutback adjustment and the 2%-of-AGI floor are imposed on the employee. The
a. employee has the burden of being able to substantiate the expenses involved.
Furthermore, no deduction is available if the employee does not itemize deductions
from AGI.
The reimbursement must be reported as income. Deductions are handled as in part a.

b. above.
c. Unless the reimbursement identifies the expenses covered, it must be allocated between
the items that are and are not subject to the cutback adjustment.
d. A washout results. In effect the expenses are treated as deductions for AGI and fully
offset the reimbursement. As far as the employee is concerned, the expenses are not
subject to the cutback adjustment or the 2%-of-AGI floor.
POINTS: 1
: CMPV.SWFT.LO: 9-09 - LO: 9-09

144. Ramon and Ingrid work in the field of public relations and incur sizable entertainment expenses. Ramon is employed
by a consumer products company, while Ingrid is a self-employed consultant. Regarding the tax treatment of the
entertainment expenses, when would:
a. Ramon be better off than Ingrid?
b. Ingrid be better off than Ramon?
ANSWER: a. If Ramon renders an adequate accounting to his employer and is fully reimbursed. In
such a case, the employee reports no income or deduction as to these expenses. The
cutback adjustment is suffered by the employer.
b. If Ramon does not render an adequate accounting to his employer, he will have to
recognize any reimbursement as income and substantiate any deduction. Even worse,
he will be subject to the cutback adjustment and the deduction will be a miscellaneous
itemized deduction upon which the 2%-of-AGI limit is imposed. Although Ingrid also
will be subject to the cutback adjustment, she has a deduction for AGI upon which the
2% rule does not apply.
POINTS: 1

KEYWORDS: Bloom's: Analysis
Sue performs services for Lynn. Regarding this arrangement, use the legend provided to classify each statement.
a. Indicates employee status.
b. Indicates independent contractor status.
DIFFICULTY: Easy
QUESTION TYPE: Matching
OTHER: Time: 2 min.
145. The services are performed at Sue’s premises.

ANSWER: b
POINTS: 1
146. Sue does not work for other parties.
ANSWER: a
POINTS: 1
147. Lynn determines when the services are to be performed.

ANSWER: a
POINTS: 1
148. Sue has unreimbursed expenses.

ANSWER: b
POINTS: 1
149. Sue was trained by Lynn.

ANSWER: a
POINTS: 1
150. Sue uses her own helpers.

ANSWER: b
POINTS: 1
151. Sue charges by the hour for her work.

ANSWER: a
POINTS: 1
152. Sue files a Form 2106 with her Form 1040.

ANSWER: a
POINTS: 1
153. Sue files a Schedule SE with her Form 1040.

ANSWER: b
POINTS: 1
154. Sue uses her own tools.

ANSWER: b
POINTS: 1
Match the statements that relate to each other. (Note: Choice L may be used more than once.)
a. Must involve the same trade or business
b. Must be for the convenience of the employer
c. Meals while in route
d. Lodging while in route
e. Out-of-town job assignment lasts for more than one year
f. Can include actual cost of parking
g. Payment for services rendered based on tasks performed
h. Excludes use of MACRS depreciation
i. Taxpayer has tools and helper provided for him
j. Transportation must be allocated if taxpayer spends two weeks on business and one week sightseeing
k. Paralegal obtains a law degree
l. Correct match not provided
DIFFICULTY: Easy
QUESTION TY Matching
PE:
HAS VARIABLE False
S:
LEARNING OB CMPV.SWFT.LO: 9-01 - LO: 9-01
JECTIVES: CMPV.SWFT.LO: 9-02 - LO: 9-02
NDARDS:
STATE STAND United States - AK - AICPA: FN-Measurement -
ARDS: AICPA: FN-Measurement
United States - AK - AICPA: FN-Reporting

OTHER: Time: 2 min.
NOTES: According to the IRS, a law degree does not maintain or improve existing skills but leads to
the creation of a new skill.
Allocation is necessary since the taxpayer meets neither of the two exceptions (i.e., trip lasts 7
days or less, or less than 25% of time was for personal purposes).
Also includes F.
D:
D:
155. Characteristic of a taxpayer who has the status of an employee

ANSWER: i
POINTS: 1
156. Characteristic of a taxpayer who is self-employed

ANSWER: g
POINTS: 1
157. Actual cost method of determining auto expense
ANSWER: f
POINTS: 1
158. Automatic mileage method

ANSWER: h
POINTS: 1
159. Deductible moving expense

ANSWER: d
POINTS: 1
160. Nondeductible moving expense

ANSWER: c
POINTS: 1
161. Mixed use (both business and pleasure) foreign travel

ANSWER: j
POINTS: 1
162. Education expense that is not deductible to maintain or improve existing skills
ANSWER: k
POINTS: 1
163. Tax home has changed

ANSWER: e
POINTS: 1
164. Deductible job-hunting expenses

ANSWER: a
POINTS: 1
165. Deduction by an employee of unreimbursed office-in-the-home expenses

ANSWER: b
POINTS: 1
166. Mixed use (both business and pleasure) domestic travel.

ANSWER: l
POINTS: 1
Match the statements that relate to each other. (Note: Choice L may be used more than once.)
a. Cover charge paid to entertain client at a night club.
b. Deductible even if taxpayer does not take the new job
c. Company picnic sponsored by employer
d. Use of Federal per diem allowance to substantiate meals while in travel status
e. Does not have to be job related
f. Can include cost of car insurance and automobile club dues
g. Distribution from plan is taxable
h. Distribution from plan is not taxable
i. Expatriate (U.S. person who is employed overseas) returns home to retire
j. Taxpayer moves to a new residence 55 miles closer to his present job
k. Country club membership fee
l. Correct match not provided
DIFFICULTY: Easy
QUESTION TYPE: Matching
United States - AK - AICPA: FN-Reporting

OTHER: Time: 2 min.
NOTES: Taxpayer did not change jobs, so no moving expense deduction is allowed.
However, withdrawals are subject to tax.
Also includes A.
Taxpayer need not accept any employment offers that result from the job search.
One of the major advantages of § 222 is that the education need not be job
related.
167. Actual cost method of determining car expense

ANSWER: f
POINTS: 1
168. Distance test (for moving expenses) not satisfied

ANSWER: j
POINTS: 1
169. Time test (for moving expenses) waived

ANSWER: i
POINTS: 1
170. Roth IRAs
ANSWER: h
POINTS: 1
171. Keogh (H.R. 10) plans

ANSWER: g
POINTS: 1
172. Cutback adjustment applies

ANSWER: a
POINTS: 1
173. Cutback adjustment does not apply

ANSWER: c
POINTS: 1
174. Deemed substantiation

ANSWER: d
POINTS: 1
175. Job hunting expenses

ANSWER: b
POINTS: 1
176. Qualified tuition and related expenses (under § 222)

ANSWER: e
POINTS: 1
177. Club dues deductible

ANSWER: l
POINTS: 1
178. Club dues not deductible

ANSWER: k
POINTS: 1
179. Traditional IRA contributions made after an individual reaches the age of 65 are treated as excess contributions and
are subject to a nondeductible 6% excise penalty tax.
a. True
b. False
ANSWER: False
RATIONALE: Such treatment is applicable if contributions are made after the individual reaches age 70
1/2.
POINTS: 1
DIFFICULTY: Easy

OTHER: Time: 2 min.
180. If an employer’s contribution to a SEP IRA is less than $54,000 in 2017 (or 25% of the employee’s earned income, if
less), the employee can contribute the difference.
a. True
b. False
ANSWER: False
RATIONAL A SEP is a qualified plan. The limit on an employer’s contribution for a particular employee is the smaller of
E: $54,000 (in 2017) or 25% of the employee’s earned income. However, elective employee deferrals are
subjected to a statutory ceiling of $18,000 (in 2017).
POINTS: 1
DIFFICULT Easy
Y:
QUESTIO True / False
N TYPE:
HAS VARI False
ABLES:
OBJECTI
VES:
STANDAR
DS:
:
DS:
OTHER: Time: 5 min.
DATE CRE 11/28/2016 3:42 PM
ATED:
DATE MO 5/11/2017 1:08 PM
DIFIED:
181. A participant has an adjusted basis of $0 in any nondeductible contributions to a traditional IRA.
a. True
b. False
ANSWER: False
RATIONALE: For deductible contributions, the adjusted basis is zero. For nondeductible contributions, the basis for
a traditional IRA is equal to the amount of the contributions.
POINTS: 1
DIFFICULTY: Easy
QUESTION TYP True / False
E:
HAS VARIABLES False
:
ECTIVES:
NDARDS:
OTHER: Time: 2 min.
DATE CREATED 11/28/2016 3:42 PM
:
:
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The Project Gutenberg eBook of Auringon
purjeet
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and most other parts of the world at no cost and with almost no
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you are located before using this eBook.
Title: Auringon purjeet

Runoja
Author: Lauri Viljanen
Release date: April 6, 2024 [eBook #73343]
Language: Finnish
Original publication: Porvoo: WSOY, 1924
Credits: Tuula Temonen
*** START OF THE PROJECT GUTENBERG EBOOK AURINGON

PURJEET ***
AURINGON PURJEET
Runoja
Kirj.
LAURI VILJANEN
Porvoossa, Werner Söderström Osakeyhtiö, 1924.

SISÄLLYS:
MAA
Sonetti maalle
Kevätaamu
Sonetti hyvyydelle
Metsässä
Sonetti suvesta
Laulu tasangolle
Gaia
Syysaamu
NARKISSOS
Narkissos
Uimari
Metsälähde
Lentotähti
Myrsky kuutamolla
LENTÄVÄ HOLLANTILAINEN
Lentävä hollantilainen
Prometheus
Isänmaalle
MELANKOLIA
Ensi lumi
Uolevin laulu Elinalle
Asepoika
Consolatio
Kevätyö luodolla
Alakuloinen rakkaudenlaulu
Syyslaulu
Kaipaus
Lumi viileä verhoo maata…
AURINGON PURJEET
Helianthus
Iltasiunaus
Kevättalvi
Helluntailaulu
Tanssiaisunelma
Juhannuslaulu
Sérénade exotique
Purjehtijat
MAA
SONETTI MAALLE
Ma taasen tartuin kevätkuokkahan, ja minkä voiman tunnon

sainkaan sulta, sa musta, vakaa, vaatimaton multa, kuin
luomisilon hetken ihanan!
Sa annoit lahjan paljon paremman kuin haaveitten ja unten

halpa kulta. Ah, onni kaikki vain on virvatulta, sa äidinsyli
suuri maailman!
»Sa maaksi tulet, joka maata oot!»

Nuo synkät sanat syvemmin kuin ennen
mun toivonani mieleen painukoot!
Mik' onni iät itsens' unohtain ois kevään, suven, syksyn,

talven mennen sun povellasi, multa, luoda vain.
KEVÄTAAMU
Ma laata katsomasta ja kuulemast' en voi: tään aamun ihme

vasta se kevään maille toi! Nyt kuultaa lehdet hennot ja nukka
nurmikon: niiss' aamukasteen kennot niin mesikirkkaat on!
Kaikk' ilmat iloon nostain taas linnut livertää, ja karja ääntää

jostain myös vangin ikävää! Ja kukon laulu kaikaa viel'
aamuun siniseen, vaikk' kyntömies jo aikaa on mennyt
pellolleen.
All' auran multa jälleen se kääntyy valohon, kuin ennen

kylväjälleen taas avoin, altis on. Oi lapsuuskoti suurin, Maan
povi armoinen, vain sinuun syvin juurin ma laulan sydämen!
SONETTI HYVYYDELLE
Lie elämämme aamun unta vain, jos avaat taikka suljet

silmäteräs. Oon itselleni ihmislapsi eräs, jot' en ma tunne
kesken tuttavain.
Mut' sydäntä, ah, kuunnella ma sain, ja niinkuin kevät

huikaiseva heräs ja mullan voimat aurinkohon keräs, niin
kypsyi rauha syvä rinnassain.
Oi jumalainen Hyvyys, hymyssäsi on kevättaivaan ikikuulas

sini ja mullan syvyys sinun povessas!
Sa niinkuin viileä ja hellä käsi. mun kosket polttavaisiin

silmihini ja tunnen olevani voimakas.
METSÄSSÄ
Vilpoisella ruohovuoteellain maata miehen joutilaan on hyvä.

Yllä männynlatvain huojuvain huokaa tuulen tuutulaulu syvä.
Joskus tuokioksi havahdun,

raukeasti silmäluomet avaan.
Katson metsän täyteen riemuhun,
lintuun heleästi laulahtavaan.
Tuuli pitkän riemusäveleen

pihkanpunertaviin oksiin soittaa.
Varkain myöskin miehen uupuneen
suuri, suvenuusi onni voittaa.
Tuoksuvina havut huojuilee

valomeren lainehissa kylpein.
Hiljaa autuudesta vapisee
korkealla honganlatva ylpein.
Rannattomaan poutaterheneen
itse päivän punakehrä hukkuu!
Tunnit antaa kättä toisilleen.
Ruohikossa onnenpoika nukkuu.
SONETTI SUVESTA
On suvi tullut vainioille jälleen. On kupu taivaan laannut

kuultamasta eik' enää sadekuuroin maata kasta, vaan hymyy
tyynesti kuin ystävälleen.
Ja ruis ehtinyt on täysimmälleen voikukkain, kuminoiden

kesken vasta. Nyt punertavan viljan huojunnasta sa näät sen
lupauksen isännälleen.
On tuulen huoku lämmin, täyteläinen ja siitepölyn savua se

kantaa tuoll' yllä mataroiden kellerväin.
Vain ruislinnun ääni kehrääväinen — vain valkee kirkko

vasten taivaanrantaa ja kumpuin aaltoviiva edessäin.
LAULU TASANGOLLE
Taas halki vainioiden harhailen ma tulless' aavistavan

suviyön. On ilta ihmeen raskas, hiljainen, mun yksin sykkii
rinnassani syön. Ah, jostain kunnaan takaa kuitenkin viel'
äänet, naurut iltaan heläjää, ja salaa kammottaen humisee
siell' arkipauhu suuren kaupungin, Mut unta on ne tääll', ei
elämää, Maan syvää äidinääntä sydän kuuntelee.
Jo lännen taivas palaa vaaleten, ja yötä kohden mullat

tasangon ne hohteen saavat kullanhämyisen kuin unten
loiston mieli rauhaton. Ah, onnenkaihon kaukahinen maa tuoll'
aukee luota taloin nukkuvain, miss' illan rusko iät pakenee
kuin kauneus yötumman metsän taa ja takaa usvain
unihunnun vain sen aatoksista synkkää otsaa suutelee.
Yl' unenraskaan ehtootasangon on päivän mieli meren

vuoteeseen, mut konsanaan sen kaipuu rauhaton ei laskeudu
lepoon ikuiseen. Ja ylpeyden kalkkiin katkeraan myös sydän
levoton ja kuumeinen sa turhaan halaat janos jäähdyttää, kun
idän taivas kantaa kasvoillaan vain surun raudankovan
ilmehen ja kevätoraan silkki sinertää kuin jää.
Pian valaa kentät nukkuvaiset nuo taas päivä nuolisatein
polttavin, ja rauhaisalle tasangolle tuo se huudot
kuumesairaan kaupungin. Kuink' aaltoihisi, kaipuu,
hukkuukaan, sa virta ikuinen ja levoton, kaikk' onnen
kypsyväisen odotus! Mist' intohimo saikaan maailmaan, mist'
ilo, tuska, jano nautinnon ja lemmennälkä, viha, kiihko,
kateus?
Ah että silmihini milloinkaan myös meri siinsi

saavuttamaton! Niin syvään, ihmeelliseen huminaan nyt yhtyy
äänet kotitasangon — niin vakaa alla astua on tie, kuin
hiljaisesta rikkaudesta Maan vain osa koko olentoni ois, kuin
Aika, joka rauhan multa vie, ois täällä seisahtunut matkallaan
ja unhottanut yön ja päivän kierron pois.
GAIA
Oi Gaia, ruumiis elontäyteläisen sa raskain vaipoin vielä

verhoat, ja alta nurmihuntus viherjäisen vain salaa kuultaa
muotos mahtavat. Sun hymyilyysi vastaa korkeudesta viel'
ylväs päivä kuumin suudelmin, siks povestasi
onnenhurmaisesta ma turhaan rakkautta rukoilin.
Mut eilen, huomasin, sun huuliltasi jo henki tyyni, illanraitis

syys, ja muistohoin niin suurna noustessasi mun täytti
riemullinen ikävyys. Oi, kohta tuskan vihurit ne pauhaa, ja
alastonna, ruskein jäsenin, mut' silmät loistain syksyn suurta
rauhaa sa katsot ylös sineen, tähtihin.
Et kammoo talven pakkasta ja jäätä, sun povessashan

kevät uinuu uus, ei kysy rikkautesi päiväin päätä, on suvi
täyttyvä jo ikuisuus. Oi, milloin syvän sielunrauhas tapaan, sa
elon hengen uskollinen syön, niin että kutsus, lempeän ja
vapaan, voin laulaa yli Ajan myrsky-yön?
SYYSAAMU
Sa pyytäin rinnan rauhaa uutta taas astu aamuun hopeiseen

— juo taivaan ilmain avaruutta syysäärettömäks auenneen!
Nyt syksyn vainioiden yllä on valon suuri sunnuntai, nyt onni
on myös hyljätyllä, Maa tyynen armovoiman sai.
Jo malmisoinnuin kutsuu kellot pois hämyyn vanhan

temppelin, ja paljaat, kellertävät pellot jää unhoon mullan
unihin — ah, ihaniin kuin toivo parhain Maan lapsen aina
suruisen tääll' yli elon tyhjäin harhain vain saada voima
sydämen.
Oi kylä pieni, yksinäinen — ei pyhäs rauha kuulla voi, kuin

syksyn tuuli herääväinen, vihurin viesti, ylläs soi! On pyynnöt
turhat Aikaa vastaan, ikuisen voiton unelmin jo myrskyn ääni
kutsuu lastaan pois meren suuren sotihin.
NARKISSOS
NARKISSOS
Kirkas kevätpäivä ensimmäinen illan tullen peittyi pilvihin.

Lankee muisto outo, yksinäinen sydämeeni suurin pisarin.
Virrast' uljaasta näin unen kerta,

joka rannattoman aavikon
kostuttain päin suurta valtamerta
rientää, rientää, mut ei lepohon.
Onnellisna omaan lehteen, kukkaan

puhkee joka ruoho, yrtti, puu:
multa yksin elämä vain hukkaan
syviin, syviin vesiin heijastuu —!
Turhaa kaikki, kauneus ja hyvyys,

turhaa rannan vuokkoin kukoistus,
turhaa tummain sydänvetten syvyys,
turhaa riuduttava rakkaus!
Kevät kesään, syksy talveen vaihtuu, läikkyy, jäätyy, sulaa

sydämein. Pisaroina kaikki voima haihtuu, umpihete nielee
nuoruutein.
UIMARI
Aaltoja, viileitä aaltoja alla, aaltojen siintoa ympäri vain!

Taakseni kuohuja halkomalla jää vana kuplien vaahtoavain.
Valkeat hattarat viittovat yllä

pois sinen polttavan ilohon —!
Luoksenne, luoksenne kaihoon kyllä,
mutta vain eespäin matkani on.
Ääretön ulappa kaikkia kantaa,

harvat taipuvat kuunteluhun:
nousta ja vaipua, anteeks antaa
ensin itselles täytyy sun.
Syvin, kantavin tyrskähdyksin

elämän meri aaltoelkoon —
kuulla ja nähdä, taistella yksin,
siihen vain minä syntynyt oon.
Kiitävä virta se alkuunsa palaa,

yöt yhä päiviä pyytää taas:
matkan ja määrän poveni salaa,
juo, sydän, ikuista unelmaas!

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South Western Federal Taxation 2018 Comprehensive 41st

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South-Western Federal Taxation 2018 Comprehensive 41st

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STATE STANDARDS: United States - AK - AICPA: FN-Reporting

KEYWORDS: Bloom's: Comprehension

HAS VARIABLES: False

LEARNING OBJE CMPV.SWFT.LO: 9-02 - LO: 9-02

NATIONAL STANDARDS: United States - BUSPORG: Comprehension - BUSPORG:Comprehension

KEYWORD Bloom's: Comprehension

KEYWORDS: Bloom's: Knowledge

STATE STANDARDS: United States - AK - AICPA: FN-Reporting

LEARNING OBJE CMPV.SWFT.LO: 9-05 - LO: 9-05

DATE MODIFIED: 5/11/2017 1:07 PM

KEYWORDS: Bloom's: Knowledge

OTHER: Time: 2 min.

OTHER: Time: 2 min.

HAS VARIABLES: False

STATE S United States - AK - AICPA: FN-Reporting

DATE C 11/28/2016 3:32 PM

STATE S United States - AK - AICPA: FN-Reporting

DATE C 11/28/2016 3:32 PM

DATE MODIFIED 5/11/2017 1:08 PM

STATE STA United States - AK - AICPA: FN-Measurement -

b. Dr. Brown, a surgeon, attends a two-day seminar on financial planning.

Air fare $3,000

Sophie’s deductible expenses are:

KEYWORD Bloom's: Application

KEYWORD Bloom's: Comprehension

STATE S United States - AK - AICPA: FN-Measurement -

DATE C 11/28/2016 3:32 PM

KEYWORD Bloom's: Application

KEYWORD Bloom's: Comprehension

DATE C 11/28/2016 3:32 PM

HAS VARIABLES: False

LEARNING OBJE CMPV.SWFT.LO: 9-06 - LO: 9-06

DATE C 11/28/2016 3:32 PM

QUESTION T Multiple Choice

NATIONAL S United States - BUSPORG: Comprehension - BUSPORG:Comprehension

STATE STAN United States - AK - AICPA: FN-Measurement -

OTHER: Time: 5 min.

DATE C 11/28/2016 3:32 PM

DATE C 11/28/2016 3:32 PM

Home to first job 9 miles

How much of the mileage qualifies for deduction purposes?

OTHER: Time: 5 min.

NATIONAL STANDARDS: United States - BUSPORG: Comprehension - BUSPORG:Comprehension

STATE STANDARDS: United States - AK - AICPA: FN-Measurement -

How much can Rod claim for mileage?

DATE MODIFIED 5/11/2017 1:08 PM

DATE C 11/28/2016 3:32 PM

HAS VARIABLES: False

LEARNING OBJE CMPV.SWFT.LO: 9-03 - LO: 9-03

NATIONAL STANDARDS: United States - BUSPORG: Comprehension - BUSPORG:Comprehension

STATE STANDARDS: United States - AK - AICPA: FN-Measurement -

a. Deductions for AGI?

b. Deductions from AGI?

STATE STANDARDS: United States - AK - AICPA: FN-Measurement -