1. Arthur is 65 years old. He supports his father, who is 90 years old, blind, and has no income. For 2014, how many exemptions should Arthur claim on his tax return?
a. 1
b. 2
c. 3
d. 4
e. 5

2. Taxpayers who are 65 or older get the benefit of:
a. An additional exemption
b. An additional amount added to their standard deduction
c. An additional amount added to their itemized deductions
d. None of the above

3. Taxpayers who are blind get the benefit of:
a. An additional exemption
b. An additional amount added to their standard deduction
c. An additional amount added to their itemized deductions
d. None of the above

4. Which of the following is not a capital asset to an individual taxpayer?
a. Stocks
b. A 48-foot sailboat
c. Raw land held as an investment
d. Inventory in the taxpayer’s business
e. All of the above are capital assets

5. Jayne purchased General Motors stock 6 years ago for $20,000. In 2014, she sells the stock for $35,000. What is Jayne’s gain or loss?
a. $15,000 short-term
b. $15,000 long-term
c. $15,000 ordinary
d. $15,000 extraordinary
e. No gain or loss is recognized on this transaction

6. Alexis purchased a rental house 3 years ago for $285,000. Her depreciation to date is $35,000. Due to a decrease in real estate prices, she sells the house for only $275,000 in 2014. What is her gain or loss for tax purposes?
a. $0
b. $10,000 loss
c. $10,000 gain
d. $35,000 loss
e. $25,000 gain

7. Shannon has a long-term capital loss of $7,000 on the sale of bonds in 2014. Her taxable income without this transaction is $48,000. What is her taxable income considering this capital loss?
a. $41,000
b. $45,000
c. $48,000
d. $55,000
e. Some other amount

8. The 3.8 percent Medicare tax on net investment income applies to:
a. Tax-exempt interest income
b. Interest and dividends
c. IRA distributions
d. Wages

9. The top ATRA tax rate for long-term capital gains was increased to ___ percent, and the ACA added a net investment income Medicare surtax for high-income taxpayers of ___ percent, for a maximum long-term capital gain tax rate of ___ percent in 2013. Fill in the blanks.
a. 25; 3.8; 28.8
b. 20; 0.9; 20.9
c. 20; 3.8; 23.8
d. 39.6; 0.9; 40.5

10. Electronically filed tax returns:
a. May not be transmitted from a taxpayer’s home computer
b. Constitute more than 90 percent of the returns filed with the IRS
c. Have error rates similar to paper returns
d. Offer faster refunds than paper returns