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- Which of the following accurately describes the tax implications of investing in real estate and rental properties? a) Real estate investments are not subject to taxation. b) Rental income is tax-exempt. c) Rental income is subject to taxation, and expenses related to real estate investments may be deductible. d) Rental income is taxed at a fixed rate determined by the IRS.For tax purposes, you can deduct the __________________________ portion of debt service. The tax deductibility of this unique to real estate Group of answer choices 1) principal, true 2) interest, true 3) not enough information has been provided 4) principal, false 5) interest, falseWhich of the following is accurate regarding a real estate foreclosure transaction? A A foreclosure transaction can never involve recourse debt. B A foreclosure transaction can never involve nonrecoursedebt. C A foreclosure transaction has no federal income taxconsequences for the borrower. D A foreclosure transaction can have significant federalincome tax consequences for the borrower.
- 4Tax Treatment of Capital Gains from the Sale of Property: Step 1: Determination of Capital Gain: Capital gains arise when the selling price of a property exceeds its original cost basis. The cost basis includes the purchase price and any qualifying expenses, such as closing costs and improvements. The difference between the selling price and the cost basis is the capital gain. Step 2: Classification of Capital Gains: Capital gains are categorized as either short-term or long-term, depending on the holding period of the property. If the property is held for one year or less, the gain is considered short-term. If held for more than one year, it is classified as a long-term capital gain. Step 3: Tax Rates for Capital Gains: The tax treatment of capital gains varies based on their classification: Short-term Capital Gains: Taxed at the individual's ordinary income tax rates, which can be higher than rates for long-term gains.Which of the following is true? a. Points paid to get a mortgage (origination points) are tax deductible while points paid to lower the interest rate are not. b. Points paid to get a mortgage (origination points) are not tax deductible while points paid to lower the interest rate are. c. Both types of points are tax deductible. d. Neither type of points is tax deductible. If the listing realtor and your realtor (you are the buyer) are the same person a. you know you are going to get a great deal b. you do not really know whose interest the realtor has at heart c. this by law cannot happen d. you only have to pay half of the realtor's commission Which of the following statement is true? a. If you put less than 20% down on a house, you have to get mortgage insurance. No matter how much you put down, if you have a mortgage, you have to get mortgage insurance. b. c. If you put more than 10% down, you do not have to get mortgage insurance. d. Mortgage insurance from the lender is…
- Which is false? a. The estate tax is computed based on the net estate or taxable estate. b. The net estate is determined by subtracting from the gross estate the deductions authorized by law. C. Both a" and D d. Neither a" nor "b"Which one of the following is not deductible when itemizing a, State income tax b, Real property tax c, Cigarette tax d, None of these3-Which one of the following tax is payable by executors on the value of the estate of a deceased person? a. Inheritance tax b. Property tax c. Capital gain tax d. None of the options
- Which of the following is correct? a) An item of gross income that is subject to tax in one scheme will not be taxed by the other schemes. b) An item of income that is exempt from regular income taxation may be subject to capital gains taxation. c) In final income taxation, the taxpayer remits the tax to the government. d) All capital gains from capital assets are subject to capital gains tax.It is a tax levied on an heir's inherited portion of an estate if the estate's value surpasses an exclusion limit set by law. a. Estate Tax b. Personal Income Tax c. Consumption Tax d. Property TaxWhich of the following taxes is not deductible as an itemized deduction? a.Sales tax in a state with no income tax b.State income tax c.Federal income tax d.Property tax on second residence
