Match Each Statement with the Correct Term Below

question 107

Multiple Choice

Match each statement with the correct term below.
-Personal exemption amount

• A)Prepaid interest.
• B)An amount that each taxpayer who is neither a qualifying child nor a qualifying relative,and who files a return,is allowed to deduct.
• C)One test for a qualifying relative.
• D)The minimum amount a taxpayer can deduct for personal expenditures.
• E)A deduction in this category is always allowed.That is,there is no minimum allowable amount and generally no income limitation placed on these deductions.
• F)Generally,these deductions are for specifically allowed personal expenditures.
• G)An exception to this test is a custodial parent.
• H)Interest paid on debt used to buy securities.
• I)Interest paid on credit cards,personal loans,car loans,etc.
• J)Interest paid on a mortgage secured by the taxpayer's residence.The proceeds of the loan can be used for any purpose and the interest is still deductible.
• K)A tax designed to prevent the shifting of unearned income to children of the taxpayer.

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Definitions:

Assignment

The transfer of rights or property from one party to another.

Agreement

A mutual understanding or arrangement, typically formalized by a contract, between two or more parties.

Substantial Performance

In contract law, the situation that results when a party to a contract, in good faith, executes all the promised terms and conditions of the contract with the exception of minor details that do not affect the real intent of their agreement.

Promising

pertains to showing signs of future success or positive outcomes.