18. Why would a taxpayer file a tax return if not required to do so? a. To remai

Question

18. Why would a taxpayer file a tax return if not required to do so? a. To remain in favor with the IRS b. To claim a refund of taxes paid c. All taxpayers are required to file returns d. In order to claim the standard deduction e. To avoid getting audited by the IRS 19. Mr. Mustache operates an upscale restaurant and he pays experienced cooks $35,000 per year. This year he hired his son as an apprentice cook Apprentice cooks usually earn $25,000 per year. Mr. Mustache agreed to pay his son $40,000 statement about this transaction? per year. Which of the following is a true Mr. Mustache will be allowed to deduct $40,000 only if his son eventually develops a. into an experienced cook b. Mr. Mustache will be allowed to accrue $40,000 only if he pays his son in cash c. Mr. Mustache will be allowed to deduct $35,000 as compensation and another $10,000 can be deducted as an employee gift d. Mr. Mustache can only deduct $20,000 because an apprentice cook is only worth half as much as an experienced cook e. None of these - Mr. Mustache can only deduct reasonable compensation 20. Which of the following is a true statement? a. Interest expense is not deductible if the loan is used to purchase municipal bonds b. Insurance premiums are not deductible if paid for "key man" life insurance c. One half of the cost of business meals is not deductible d. All of these are true e. None of these is true 21. The wage base for which of the following taxes is capped? a. Federal income b. Social Security c. Medicare d. Self-Employment tax e. Alternative minimum

Explanation / Answer

18. All taxpayers are required to file the tax return.

19. A part is the correct answer.

20. C part is correct

21. B social security is correct

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