Preparing for Taxes
Which of the following are legal methods of reducing your current tax liability?
@) b & c
A married couple filing a joint return has Ms. Cindy cook a CPA, complete their return. The IRS will hold only MS. Cook responsible for any errors on the return
False
Mortgage interest and credit card interest are both itemized deduction items
False
The alternative minimum tax is an issue only for high- income taxpayers
False
The federal personal income tax is a regressive tax
False
You are preparing your own tax return. The least costly source for answering your questions would be
IRS 800 numbers
The federal income tax is
Progressive
If you do not wish to itemize deductions, you can use the...
Standard deduction
An investment must be owned over one year in order to qualify for long-term capital gain treatment
True
One's average tax is typically lower than one's marginal tax rate
True
Opening a traditional IRA would allow you to defer taxes on the earning
True
Social Security taxes are paid on external income but not on investment income
True
Tax avoidance is a legal means to minimize tax liabilities
True
The Congress writes and passes the Internal Revenue Code
True
you should itemize deductions when total itemized deductions exceed the standard deduction
True
The federal personal income tax is a regressive tax
false