Common Tax Credits - CPA Regulation (REG)
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Which of the following credits can result in a refund even if the individual had no income tax liability?
Which of the following credits can result in a refund even if the individual had no income tax liability?
Tap to reveal answer
“Refundable” tax credits are allowable in excess of a taxpayer’s tax obligation and may result in a refund. Among the possible answers, only the earned income credit is “refundable.” While the other answers may result in reducing a tax obligation to zero, they may not be taken in excess of this to result in a tax refund in a given year.
“Refundable” tax credits are allowable in excess of a taxpayer’s tax obligation and may result in a refund. Among the possible answers, only the earned income credit is “refundable.” While the other answers may result in reducing a tax obligation to zero, they may not be taken in excess of this to result in a tax refund in a given year.
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How may taxes paid by an individual to a foreign country be treated?
How may taxes paid by an individual to a foreign country be treated?
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Generally speaking, taxes paid to foreign entities result in a dollar-for-dollar reduction in the US tax obligation (a credit), rather than a reduction of taxable income (a deduction).
Generally speaking, taxes paid to foreign entities result in a dollar-for-dollar reduction in the US tax obligation (a credit), rather than a reduction of taxable income (a deduction).
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Ron and Leslie have two children, ages 7 and 9. Both children meet the definition of qualifying child. The family has adjusted gross income of $325,000. What is the amount of the child tax credit on the couple’s income tax return?
Ron and Leslie have two children, ages 7 and 9. Both children meet the definition of qualifying child. The family has adjusted gross income of $325,000. What is the amount of the child tax credit on the couple’s income tax return?
Tap to reveal answer
The child tax credit is worth up to $2,000 for children classified as dependents who are under age 17 as of the last day of the tax year. The credit phases out starting at $200,000 for single filers, and $400,000 for joint filers.
The child tax credit is worth up to $2,000 for children classified as dependents who are under age 17 as of the last day of the tax year. The credit phases out starting at $200,000 for single filers, and $400,000 for joint filers.
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Of the following, which credit can result in a refund even if the individual had no income tax liability?
Of the following, which credit can result in a refund even if the individual had no income tax liability?
Tap to reveal answer
The earned income credit is refundable. Eligible taxpayers can get advance payments from their employers because the credit is assured.
The earned income credit is refundable. Eligible taxpayers can get advance payments from their employers because the credit is assured.
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How many taxes paid by an individual to a foreign country be treated?
How many taxes paid by an individual to a foreign country be treated?
Tap to reveal answer
A taxpayer may claim a credit against federal income taxes due for foreign income taxes paid to a foreign country or a US possession. There is a limitation on the amount of the credit an individual can obtain.
A taxpayer may claim a credit against federal income taxes due for foreign income taxes paid to a foreign country or a US possession. There is a limitation on the amount of the credit an individual can obtain.
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Of the following, which is a valid tax credit in the United States under the IRS?
Of the following, which is a valid tax credit in the United States under the IRS?
Tap to reveal answer
Only the Earned income credit is a real credit. The others are made up of credits.
Only the Earned income credit is a real credit. The others are made up of credits.
← Didn't Know|Knew It →
Which of the following credits can result in a refund even if the individual had no income tax liability?
Which of the following credits can result in a refund even if the individual had no income tax liability?
Tap to reveal answer
“Refundable” tax credits are allowable in excess of a taxpayer’s tax obligation and may result in a refund. Among the possible answers, only the earned income credit is “refundable.” While the other answers may result in reducing a tax obligation to zero, they may not be taken in excess of this to result in a tax refund in a given year.
“Refundable” tax credits are allowable in excess of a taxpayer’s tax obligation and may result in a refund. Among the possible answers, only the earned income credit is “refundable.” While the other answers may result in reducing a tax obligation to zero, they may not be taken in excess of this to result in a tax refund in a given year.
← Didn't Know|Knew It →
How may taxes paid by an individual to a foreign country be treated?
How may taxes paid by an individual to a foreign country be treated?
Tap to reveal answer
Generally speaking, taxes paid to foreign entities result in a dollar-for-dollar reduction in the US tax obligation (a credit), rather than a reduction of taxable income (a deduction).
Generally speaking, taxes paid to foreign entities result in a dollar-for-dollar reduction in the US tax obligation (a credit), rather than a reduction of taxable income (a deduction).
← Didn't Know|Knew It →
Ron and Leslie have two children, ages 7 and 9. Both children meet the definition of qualifying child. The family has adjusted gross income of $325,000. What is the amount of the child tax credit on the couple’s income tax return?
Ron and Leslie have two children, ages 7 and 9. Both children meet the definition of qualifying child. The family has adjusted gross income of $325,000. What is the amount of the child tax credit on the couple’s income tax return?
Tap to reveal answer
The child tax credit is worth up to $2,000 for children classified as dependents who are under age 17 as of the last day of the tax year. The credit phases out starting at $200,000 for single filers, and $400,000 for joint filers.
The child tax credit is worth up to $2,000 for children classified as dependents who are under age 17 as of the last day of the tax year. The credit phases out starting at $200,000 for single filers, and $400,000 for joint filers.
← Didn't Know|Knew It →
Of the following, which credit can result in a refund even if the individual had no income tax liability?
Of the following, which credit can result in a refund even if the individual had no income tax liability?
Tap to reveal answer
The earned income credit is refundable. Eligible taxpayers can get advance payments from their employers because the credit is assured.
The earned income credit is refundable. Eligible taxpayers can get advance payments from their employers because the credit is assured.
← Didn't Know|Knew It →
How many taxes paid by an individual to a foreign country be treated?
How many taxes paid by an individual to a foreign country be treated?
Tap to reveal answer
A taxpayer may claim a credit against federal income taxes due for foreign income taxes paid to a foreign country or a US possession. There is a limitation on the amount of the credit an individual can obtain.
A taxpayer may claim a credit against federal income taxes due for foreign income taxes paid to a foreign country or a US possession. There is a limitation on the amount of the credit an individual can obtain.
← Didn't Know|Knew It →
Of the following, which is a valid tax credit in the United States under the IRS?
Of the following, which is a valid tax credit in the United States under the IRS?
Tap to reveal answer
Only the Earned income credit is a real credit. The others are made up of credits.
Only the Earned income credit is a real credit. The others are made up of credits.
← Didn't Know|Knew It →
Which of the following credits can result in a refund even if the individual had no income tax liability?
Which of the following credits can result in a refund even if the individual had no income tax liability?
Tap to reveal answer
“Refundable” tax credits are allowable in excess of a taxpayer’s tax obligation and may result in a refund. Among the possible answers, only the earned income credit is “refundable.” While the other answers may result in reducing a tax obligation to zero, they may not be taken in excess of this to result in a tax refund in a given year.
“Refundable” tax credits are allowable in excess of a taxpayer’s tax obligation and may result in a refund. Among the possible answers, only the earned income credit is “refundable.” While the other answers may result in reducing a tax obligation to zero, they may not be taken in excess of this to result in a tax refund in a given year.
← Didn't Know|Knew It →
How may taxes paid by an individual to a foreign country be treated?
How may taxes paid by an individual to a foreign country be treated?
Tap to reveal answer
Generally speaking, taxes paid to foreign entities result in a dollar-for-dollar reduction in the US tax obligation (a credit), rather than a reduction of taxable income (a deduction).
Generally speaking, taxes paid to foreign entities result in a dollar-for-dollar reduction in the US tax obligation (a credit), rather than a reduction of taxable income (a deduction).
← Didn't Know|Knew It →
Ron and Leslie have two children, ages 7 and 9. Both children meet the definition of qualifying child. The family has adjusted gross income of $325,000. What is the amount of the child tax credit on the couple’s income tax return?
Ron and Leslie have two children, ages 7 and 9. Both children meet the definition of qualifying child. The family has adjusted gross income of $325,000. What is the amount of the child tax credit on the couple’s income tax return?
Tap to reveal answer
The child tax credit is worth up to $2,000 for children classified as dependents who are under age 17 as of the last day of the tax year. The credit phases out starting at $200,000 for single filers, and $400,000 for joint filers.
The child tax credit is worth up to $2,000 for children classified as dependents who are under age 17 as of the last day of the tax year. The credit phases out starting at $200,000 for single filers, and $400,000 for joint filers.
← Didn't Know|Knew It →
Of the following, which credit can result in a refund even if the individual had no income tax liability?
Of the following, which credit can result in a refund even if the individual had no income tax liability?
Tap to reveal answer
The earned income credit is refundable. Eligible taxpayers can get advance payments from their employers because the credit is assured.
The earned income credit is refundable. Eligible taxpayers can get advance payments from their employers because the credit is assured.
← Didn't Know|Knew It →
How many taxes paid by an individual to a foreign country be treated?
How many taxes paid by an individual to a foreign country be treated?
Tap to reveal answer
A taxpayer may claim a credit against federal income taxes due for foreign income taxes paid to a foreign country or a US possession. There is a limitation on the amount of the credit an individual can obtain.
A taxpayer may claim a credit against federal income taxes due for foreign income taxes paid to a foreign country or a US possession. There is a limitation on the amount of the credit an individual can obtain.
← Didn't Know|Knew It →
Of the following, which is a valid tax credit in the United States under the IRS?
Of the following, which is a valid tax credit in the United States under the IRS?
Tap to reveal answer
Only the Earned income credit is a real credit. The others are made up of credits.
Only the Earned income credit is a real credit. The others are made up of credits.
← Didn't Know|Knew It →
Which of the following credits can result in a refund even if the individual had no income tax liability?
Which of the following credits can result in a refund even if the individual had no income tax liability?
Tap to reveal answer
“Refundable” tax credits are allowable in excess of a taxpayer’s tax obligation and may result in a refund. Among the possible answers, only the earned income credit is “refundable.” While the other answers may result in reducing a tax obligation to zero, they may not be taken in excess of this to result in a tax refund in a given year.
“Refundable” tax credits are allowable in excess of a taxpayer’s tax obligation and may result in a refund. Among the possible answers, only the earned income credit is “refundable.” While the other answers may result in reducing a tax obligation to zero, they may not be taken in excess of this to result in a tax refund in a given year.
← Didn't Know|Knew It →
How may taxes paid by an individual to a foreign country be treated?
How may taxes paid by an individual to a foreign country be treated?
Tap to reveal answer
Generally speaking, taxes paid to foreign entities result in a dollar-for-dollar reduction in the US tax obligation (a credit), rather than a reduction of taxable income (a deduction).
Generally speaking, taxes paid to foreign entities result in a dollar-for-dollar reduction in the US tax obligation (a credit), rather than a reduction of taxable income (a deduction).
← Didn't Know|Knew It →