Short Answer Questions Flashcards
(12 cards)
Under VA law, taxpayers are required to retain suitable records and documents substantiating all information contained on any tax return for a period of how many years from the required date for filing a return to which such records or documents pertain?
3 years
What percentage of the cost of meals incurred while traveling on business is allowable as a deduction?
50%
What percentage of the cost of lodging incurred while traveling on business is allowable as a deduction?
100%
Under the Virginia Unemployment Compensation Act, each eligible individual who is unemployed in any week is entitled to a benefit equal to his weekly benefit amount less any part of the wages payable to him for such week that is in excess of $_______.
$50
A manager of a hotel is on 24 hour call and, therefore, is required to live on the motel property. Must the manager include the rental value of her lodging in her gross income?
No. The gross income of an employee does not include the value of meals or lodging furnished to her in kind by the employer, for the convenience of the employer, and on the employer’s premises.
An executive from Minneapolis flies to Grundy, Virginia, on business. He leaves at 5a.m. and returns at 11p.m. on the same day. Is he entitled to a deduction for the cost of his meals while in Virginia?
No. Only the expenses incurred for meals and lodging while away from home may be deducted by an employee traveling on business. The IRS has defined “away from home” as away overnight, and the Supreme Court has upheld this position.
All lottery tickets printed after July 1, 1997, must bear a toll-free number for what?
Gamblers Anonymous or other organization that provides assistance to compulsive gamblers.
Define “gross income”
Generally, gross income means all income from whatever source derived. The source of the receipt of income is irrelevant. There merely must be a clearly realized accession to wealth.
All the ordinary and necessary expenses paid or incurred during the taxable year in carrying on a business are deductible. How do courts determine what is “ordinary and necessary”?
“Ordinary and necessary” means that the expenses are common or accepted in the particular business or profession and that they relate to producing the current year’s income. Reasonable salaries, office rentals, office supplies. and traveling expenses are all deductible when incurred for business purposes.
A qualified child must be under the age of ______ years or a full-time student under the age of ______ years at the close of the taxable year.
19 and 24
As of 2015, what are the standard deduction amounts for single taxpayers and married taxpayers filing jointly, respectively?
$6,300 and $12,600
Deductions for business gifts are limited to a maximum of $________ per person during each taxable year.
$25
