1. If you owe AMT, you may be able to lower your total tax (regular tax plus AMT) by claiming itemized deductions on Form 1040, even if your total itemized deductions are less than the standard deduction. This is because

A. The standard deduction is not allowed for the AMT.
B. Claiming the standard deduction on Form 1040, you cannot claim itemized deductions for the AMT.
C. The standard deduction is allowed for the AMT.
D. Both A and B above.

2. The sum of the alternative tax net operating loss carryovers and carrybacks to the tax year, subject to limitations is

A. The ATNOLD.
B. The ATNOL.
C. The AMTI.
D. The AMTFTC.

3. Your AMT gain or loss from the disposition of property may be different from your gain or loss for the regular tax. This is because the property may have a different

A. Location for the AMT.
B. Adjusted basis for the AMT.
C. Time period for the AMT.
D. Allowable credit for the AMT.

4. Alternative minimum tax for individuals requires certain adjustments and preferences. Which of the following is a preference or adjustment item?

A. Personal exemptions.
B. Incentive stock options.
C. Tax exempt interest on certain private activity bonds.
D. All of the above.

5. Which of the following is not a tax preference item or an adjustment to taxable income for alternative minimum tax purposes?

A. Addition of personal exemptions.
B. Addition of standard deduction (if claimed).
C. Addition of all itemized deductions (if claimed).
D. None of the above.

6. If your filing status is married filing separately, you may have to pay the Alternative Minimum Tax if your taxable income for regular tax purposes, combined with certain adjustments and tax preference items, is more than

A. $70,950.
B. $22,500.
C. $35,475.
D. $46,700.

7. The tax law gives special treatment to some kinds of income and allows special deductions and credits for some kinds of expenses. Taxpayers who benefit from the law in these ways may have to pay at least a minimum amount of tax through an additional tax. This additional tax is

A. Tax on early distributions.
B. Tax preference items.
C. Alternative Minimum tax.
D. Personal property tax.

8. If your filing status is single or head of household, you may have to pay the Alternative Minimum Tax if your taxable income for regular tax purposes, combined with certain adjustments and tax preference items, is more than

A. $70,950.
B. $35,475.
C. $34,975.
D. $46,700.

9. To figure the amount, if any, of your alternative minimum tax (AMT) and to figure any credit limitation use

A. Form 6251.
B. Form 8801.
C. Form 1116.
D. Form 8814.

10. Attach Form 6251 to your return if

A. Form 6251, line 32 is greater than line 35.
B. You claim any general business credit, the qualified electric vehicle credit, the empowerment zone and renewal community employment credit, the fuel vehicle refueling property credit, or the credit for prior year minimum tax.
C. The total of Form 6251, lines 9 through 28 if negative and line 32 would exceed line 35 if you did not take lines 9 through 28 into account.
D. Any of the above.

11. For 2009, the exemption amount for the alternative minimum tax (AMT) has increased to $46,700 ($70,950 MFJ or Qualifying widow(er); $35,475 if married filing separately).     

True False

12. For AMT purposes, an eligible mortgage is a mortgage whose proceeds were used to buy, build, or substantially improve your main home or a second home that is a qualified dwelling. Even a mortgage whose proceeds were used to refinance another mortgage is an eligible mortgage.                      

True False

13. Refigure depreciation for the AMT for the following:

A. Residential rental property placed in service after 1998.
B. Any part of the cost of any property for which you made the election under Section 179 expense deduction.
C. Qualified Indian reservation property.
D. None of the above.

14. The following is exempt from the environmental taxes.

A. The Federal government.
B. State and local governments.
C. Indian tribal governments and non-profit educational organizations.
D. No one is exempt.

15. Environmental taxes are imposed on crude oil and petroleum products, the sale or use of Ozone-depleting chemicals (ODCs) and imported products containing or manufacturing with these chemicals. Figure the environmental tax on

A. Form 6627 and attach it to Form 720.
B. Form 720 directly.
C. Form 4136 and attach it to Form 720.
C. Form 8849 and attach it to Form 720.

16. Tax is imposed on an imported taxable product when the product is

A. Fabricated by the company.
B. First sold or used by its importer.
C. First bought from the company for resale.
D. Transported across the border.

17. The importer may treat the sale of an article manufactured or assembled in the United States as the first sale or use of an imported taxable product incorporated in that article if

A. The importer has consistently treated the sale of similar items as the first sale or use of similar taxable imported products.
B. The importer has not chosen to treat entry into the United States as use of the product.
C. The importer has chosen to treat entry into the United States as use of the product.
D. Both A and B above.

18. Excise taxes are imposed on amounts paid for certain facilities and services. A communications tax is imposed on amounts paid for communications services such as local and toll telephone service, and teletypewriter exchange services of

A. 1%.
B. 2%.
C. 3%.
D. 5%.

19. Payments for certain services or payments for certain users are exempt from the communications tax. The tax does apply to the following service.

A. Payments received for the installation of any instrument, wire, pole, switchboard, apparatus, or equipment.
B. Payments for the repair or replacement of any instrument, wire, pole, switchboard, apparatus, or equipment incidental to ordinary maintenance.
C. Payments paid for a private line, an answering service and a one-way paging or message service if they provide access to a local telephone system.
D. Any of the above.

20. The tax on transportation of persons by air is made up of two parts; the percentage tax and the domestic-segment tax. The domestic-segment tax is a flat dollar amount for each segment of taxable transportation for which an amount is paid. A segment is

A. A single take off only.
B. A single landing only.
C. A single take off and a single landing.
D. None of the above.

21. The excise tax registration requirements for activities relating to gasoline, diesel fuel, and kerosene do not apply for the following.

A. A blender.
B. An enterer.
C. A pipeline operator.
D. An industrial user.

22. Any person who produces a taxable article from new or raw material, or from scrap, salvage, or junk material, by processing or changing the form of an article or by combining or assembling two or more articles is 

A. A producer.
B. A manufacturer.
C. An importer.
D. A seller.

23. Tax attaches when the title to the article sold passes from the manufacturer

A. To the producer.
B. To the factory worker.
C. To the buyer.
D. To the seller.

24. The sale of an article to a nonprofit education organization for its exclusive use (does not apply to the taxes on coal, gas guzzlers, and vaccines) is an example of a sale by the manufacturer that is

A. Exempt from the manufacturers tax.
B. Taxable for manufactures tax.
C. Access to a local telephone system.
D. Fabricated by the company.

25. A tax is imposed on many articles of sport fishing equipment sold by the manufacturer. This includes any parts or accessories sold on or in connection with the sale of those articles. This tax is ____ of the sales price.

A. 10%.
B. 20%.
C. 30%.
D. 50%.

26. A tax is imposed on taxable tires sold by the manufacturer, producer, or importer at the rate of $.0945 for each 10 pounds of the maximum rated load capacity over

A. 3,500 pounds.
B. 4,000 pounds.
C. 5,000 pounds.
D. 10,000 pounds.

27. Tax is imposed on certain vaccines sold by the manufacturer in the United States. A taxable vaccine is any vaccine against measles (for example).

True False

28. A credit or refund of the gasoline tax may be allowable if gasoline is used for a nontaxable purpose or exempt use.

True False

29. Tax is imposed on insurance policies issued by foreign insurers. The following rate applies to each dollar of the premium paid.

A. Casualty insurance and indemnity, fidelity, and surety bonds: 4 cents.
B. Life, sickness, and accident insurance, and annuity contracts: 1 cent.
C. Re-insurance policies covering any of the taxable contracts for any of the different kinds of insurance: 1 cent.
D. All of the above.

30. A tax is imposed on any person who issues a registration-required obligation not in registered form. The tax is 1% of the principal of the obligation, multiplied by the number of calendar years during the period starting on the date the obligation was issued and ending on the date it matures.

True False

31. To report and pay excise taxes use

A. Form 4136.
B. Form 720.
C. Form 8849.
D. Form 6990.

32. Tax is imposed on certain vaccines sold by the manufacturer in the United States. Which vaccine is a taxable vaccine?

A. Influenza.
B. Hepatitis A or B.
C. Polio.
D. Any of the above.

33. The following truck body type will meet the suitable for use standard and will be excluded from excise tax.

A. Platform truck bodies 21 feet or less in length.
B. Dump truck bodies with load capacities of eight cubic yards or less.
C. Refuse packer truck bodies with load capacities of 20 cubic yards or less.
D. Any of the above.

34. Your passive activity gains and losses must be refigured for the AMT by taking into account all adjustments and preferences and any AMT prior year unallowed losses that apply to that activity.                  

True False

35. Even if your rights in the stock are not transferable and are subject to a substantial risk of forfeiture, you may elect to include in AMT income the excess of the stock's fair market value over the exercise price upon the transfer to you of the stock acquired through exercise of the option.

True False