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Basics Beginner:
The Basics of Tax Planning
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Choose wisely. There is only one correct answer to each question.
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1.
What kind of retirement planning contributions can help you save money on filing your taxes currently?
Choose wisely. There is only one correct answer.
An HSA
A traditional IRA
A Roth 401(k)
A traditional IRA. Contributions to a traditional IRA can help you save money on filing your taxes currently.
2.
The kiddie tax is a term that applies to what type of income?
Choose wisely. There is only one correct answer.
Unearned income received by people under a certain age
Earned income received by people under a certain age
Any income received by people under a certain age
Unearned income received by people under a certain age. The kiddie tax applies to investment income and other types of unearned income.
3.
Tax considerations will be the paramount factor in any smart business person's or investor's financial decision-making process.
Choose wisely. There is only one correct answer.
True
False
False. Tax considerations are important, of course, but should not drive the decision-making process.
4.
Tax-deductible education expenses include only amounts paid for tuition and fees at an accredited college or university.
Choose wisely. There is only one correct answer.
True
False
False. Tuition at an accredited vocational school is also a qualified education expense.
5.
Which of the following statements is true?
Choose wisely. There is only one correct answer.
It is possible to reduce taxes in the current year by postponing the receipt of income.
It is possible to reduce taxes in the current year by accelerating deductions into the current year.
Both the above are true.
None of the above are true.
Both the above are true. Postponing income and accelerating deductions are both good tax strategies.
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