chapter 22

Under the Taxpayer Relief Act of 1997, a buyer can use up to how much of their IRA fund towards a down payment, without being subject to an early withdrawal penalty...? $10,000 (Dollars) $20,000 (Dollars) $500,000 (Dollars) $250,000 (Dollars)

$10,000 (Dollars)

If the depreciable basis for a single family residence is $2,750,000, what is the annual allowable depreciation, assuming a 27.5 economic lifespan...? $10,000 (Dollars) $275,000 (Dollars) $2,750,000 (Dollars) $100,000 (Dollars)

$100,000 (Dollars)

The depreciable basis of a commercial property is $525,000. Using the straight-line method, what is the allowable annual depreciation for the property...? $19,646.55 (Dollars) $15,365.13 (Dollars) $13,461.54 (Dollars) $19,090.90 (Dollars

$13,461.54 (Dollars)

If the depreciable basis for a single family residence is $550,000, what is the allowable annual depreciation using the straight-line depreciation method...? $200,000 (Dollars) $55,000 (Dollars) $20,000 (Dollars) $550,000 (Dollars)

$20,000 (Dollars)

Under the Taxpayer Relief Act of 1997, joint filers can qualify up to how much in tax exemptions...? $200,000 (Dollars) $500,000 (Dollars) $600,000 (Dollars) $250,000 (Dollars)

$500,000 (Dollars)

The annual net income for a property is $218,000. If the taxable income is $156,000, what is the allowable annual depreciation of the property...? $218,000 (Dollars) $60,200 (Dollars) $62,000 (Dollars) $156,000 (Dollars)

$62,000 (Dollars)

If the net income on a property is $97,500 and the allowable annual depreciation is $8,725, what is the taxable income for the property...? $97,500 (Dollars) $8,775 (Dollars) $8,725 (Dollars) $88,775 (Dollars)

$88,775 (Dollars)

Long-term capital gains applies to properties owned longer than...? 4 years 2 years 1 year 3 years

1 year

How much of the purchase price of a condominium is eligible for depreciation...? 100 (Percent %) Your answer was correct 80 (Percent %) The purchase price minus the land value 50 (Percent %)

100 (Percent %)

Using the straight-line depreciation method, commercial property is depreciated over how many years...? 37.5 27.5 29 39

39

When executing a 1031 Exchange, how many days does an owner have to identify a new property...? 30 days 60 days 45 days 180 day

45 days

In order to qualify for a 1031 exchange, a newly purchased property must be located where...? In the City of the original property Anywhere in the United States In the County of the original property In the State of the original property

Anywhere in the United States

A major accounting method that recognizes revenues and expenses at the time physical cash is actually received or paid out is known as...? Pro-forma Adjusted Basis Boot Basis

Basis

Cash received in a tax-deferred exchange is known as...? Capital Gain Basis Cash Flow Boot

Boot

Which of the following is considered a depreciable asset...? Buildings The correct answer Land Personal use assets Your answer was incorrect Furniture

Buildings

A monetary gain resulting from the increase in the market value of an investment, excluding additions of capital, is known as...? Boot Capital Gain Cash Flow Appreciation

Capital Gain

This type of income is associated with the sale of a property...? Operations income Active income Capital gains Passive income

Capital gains

This type of depreciation is described by the physical deterioration of a property...? Unit-of-production depreciation Taxable depreciation Capital depreciation Economic depreciation

Economic depreciation

Which of the following types of depreciation is relevant to real estate...? Capital depreciation Economic depreciation Material depreciation Unit-of-production depreciation

Economic depreciation

According to the IRS, which of the following property types is NOT considered a permitted deduction on one's tax return...? Vacant land Income producing properties Primary residence Time share

Income producing properties

This program provided a dollar-for-dollar reduction in federal taxes for developers who built rental housing that serves low income households....? Fair Housing program HUD LIHC Urban Redevelopment program

LIHC

The IRS allows homeowners to deduct this from their tax returns...? Mortgage principal Mortgage interest Mortgage payments Mortgage interest and principal

Mortgage interest

Which of the following is NOT considered operations income...? Net proceeds from sale of property Passive income Active Income Portfolio income

Net proceeds from sale of property

Property taxes on these types of properties can only be deducted if one's taxes are itemized...? Investment properties Non-investment properties Income producing properties Commercial properties

Non-investment properties

Which of the following is the correct formula for determining the Adjusted Basis on a property...? Original Purchase Price + Capital Improvements - Depreciation Original Purchase Price + Depreciation Original Purchase Price - Capital Improvements - Depreciation Original Purchase Price - Depreciation

Original Purchase Price + Capital Improvements - Depreciation

According to the IRS, which of the following property types are considered a permitted deduction...? Investment properties Commercial properties Income producing properties Personal residences

Personal residences

Which of the following refers to the amount of gain subject to tax when a property is sold...? Realized gain Net gain Recognized gains Gross gain

Recognized gains

An income deduction that allows a taxpayer to recover the cost or other basis of certain property is known as...? Tax Shelter Tax Depreciation Capital Gain Tax-Deferred Exchange

Tax Depreciation

When depreciation is subtracted from net income to determine a property's taxable income, the depreciation is considered a...? Tax credit Tax rebate Tax deduction Tax savings

Tax deduction

Due to this Act, the profits from the sale of a personal residence were allowed to be exempt...? ADA Taxpayer Relief Act of 1988 Fair Housing Act of 1968 Taxpayer Relief Act of 1997

Taxpayer Relief Act of 1997