Please answer the following as accurately as possible.
1. The carryback period
for eligible losses is 3 years. Only the eligible loss portion of the NOL can be
carried back 3 years. An eligible loss is any part of an NOL that
A. Is from a casualty or theft.
B. Is attributable to a federally declared disaster for a qualified small
business.
C. Either A or B above.
D. None of the above.
2. You can use Schedule B
(Form 1045) to figure your modified taxable income for carryback and for
carryforward years.
True
False
3. You should keep records for any tax year that generates an NOL
for 3 years after you have used the carryback/carryforward or 3 years after the
carryforward expires.
True
False
4. If your deductions for the year are more than your income for
the year, you may have an NOL. There are rules that limit what you can deduct
when figuring an NOL. In general, the following is not allowed when figuring an
NOL.
A.
Any deduction for personal exemption.
B.
Nonbusiness deductions in excess of nonbuisness income.
C.
The section 1202 exclusion of 50% of the gain from the sale or exchange of
qualified small business stock.
D.
Any of the above.
5. You can use an NOL by deducting it from your income in another
year or years. To figure an NOL use
A.
Schedule E (Form 1040).
B.
Schedule A (Form 1040).
C.
Schedule A (Form 1045).
D.
Schedule SE (Form 1045).
6. Enter on line 6 deductions that are not connected to your
trade or business or your employment. A deduction not related to your trade or
business is
A. The
deduction of one-half of your self-employment tax or your deduction for
self-employed health insurance.
B.
Deductions for contributions to an IRA or a self-employed retirement plan.
C.
Loss on the sale of accounts receivable (if you use an accrual method of
accounting.
D.
Unrecovered investment in a pension or annuity claimed on a decedent's final
return.
7. Do not include on line 6 the deduction for personal exemptions
for you, your spouse, or your dependents. Do not enter business deductions on
line 6. These are deductions that are connected to your trade or business. They
include
A.
Rental losses.
B.
Educator expenses.
C.
If you itemize your deductions, casualty and theft losses (even if they involve
nonbusiness property) and employee business expenses (such as union dues,
uniform, tools, education expenses, and travel and transportation expenses).
D.
Any of the above.
8. You can deduct your business capital losses only up to the
total of
A.
Your nonbusiness capital gains that are more than the total of your nonbusiness
capital losses and excess nonbusiness deductions.
B.
Your total business capital gains without regard to any section 1202 exclusion
(line 12).
C.
Both A and B above.
D.
None of the above.
9. The carryback period for a farming loss is 5 years. Only
the farming loss portion on the NOL can be carried back 5 years. A farming loss
is
A.
The amount that would be the NOL for the tax year if only income and deductions
attributable to farming businesses were taken into account.
B.
The NOL for the tax year.
C.
The smaller of A or B above.
D.
The greater of A or B above.
10. Generally, if you have an NOL for a tax year ending in
2008, you must carry back the entire amount of the NOL to the 2 tax years before
the NOL year (the carryback period), and then carry forward any remaining NOL
for up to 2 years after the NOL year (carry forward period). The following is a
true statement regarding an NOL.
A. You
can choose not to carry back an NOL and only carry it forward.
B.
You can deduct any NOL remaining after the 20-year carryforward period.
C.
You can only carryback an NOL.
D.
You can never carry an NOL forward.
11. A qualified disaster expense is any capital expense paid or
incurred in connection with a trade or business or with business-related
property which is
A.
For the abatement or control of hazardous substances that were released as a
result of a federally declared disaster.
B.
For the removal of debris from, or the demolition of structures on, real
property which is business-related property damaged or destroyed as a result of
a federally declared disaster.
C.
For the repair of business-related property damaged as a result of a federally
declared disaster.
D.
Any of the above.
12. If you already filed a tax return for your 2008 NOL tax
year, and you now want to choose a 3, 4, or 5-year carryback period for an ESB
loss, you must ________ for the earliest tax year to which you are carrying back
your 2008 NOL.
A.
File Form 1045.
B.
File an amended return (using Form 1040X).
C.
File Form 1045.
D.
Any of the above.
13. You can choose not to carry back your NOL. If you make
this choice, then you can use your only in the 20-year carry forward period.
True
False
14. You can apply for a quick refund. This form results in a
tentative adjustment of tax in the carry back year.
A.
Form 1040X.
B.
Form 1045.
C.
Form 1041.
D.
Form 2010.
15. Use your adjusted gross income after applying the NOL
deduction to refigure income or deduction items that are based on, or limited
to, a percentage of your adjusted gross income. Refigure
A.
The special allowance for passive activity losses from rental real estate
activities.
B.
Taxable social security and tier 1 railroad retirement benefits.
C.
Excludable savings bond interest.
D.
Any of the above.
16. A 5-year carryback period applies to the portion of an NOL
that is a qualified disaster loss applies to
A. Federally declared disaster areas.
B. Kansas disaster areas.
C. Midwestern disaster areas.
D. All of the above.
17. The carryback period for a qualified Go Zone loss is 5-years.
Only the qualified Go Zone loss portion of the NOL can be carried back 5 years.
For tax years beginning in 2008, a qualified Go Zone loss is the smaller of the
excess of the NOL for the year over the specified liability loss for the year to
which a 10-year carryback applies, or
A.
Any losses attributable to a federally declared disaster and occurring in the
disaster area.
B.
Any allowable qualified disaster expenses (even if you did not choose to treat
those expenses as deductions in the current year.
C.
The total of any depreciation allowable for qualified Go Zone nonresidential
real property and residential rental property placed in service in 2008 and
specified Go Zone extension property placed in service in 2009 during the tax
year (even if you elected not to claim the special Go Zone depreciation
allowance for such property).
D.
Any of the above.
18. The Form 1045 or amended return for a carryback must be
filed by
A. 6
months after the due date (excluding extensions) for filing the tax return for
your 2008 NOL tax year.
B.
April 17, 2009.
C.
By the later of A or B above.
D.
By the earlier of A or B above.
19. You can choose not to carry back your NOL. If you make this
choice, then you can use your NOL only in the 20-year carry forward period. If
you choose to waive the carryback period for more than one NOL, you must make a
separate choice and attach a separate statement for each NOL year. If you do not
file this statement on time, you
A. Can
still waive the carryback period.
B.
Cannot waive the carryback period.
C. Must
pay a penalty of 5% for every month or part of the month that the statement is
late.
D. None
of the above.
20. If you and your spouse file a joint return for a joint return
for a carryback or carryforward year, and were married but filed separate
returns for any of the tax years involved in figuring the NOL carryback or
carryover, figure each of your carryovers separately.
True
False
