Use IRS Publication 553 to answer the following questions.

1. You may be entitled to an economic stimulus payment of up to $600 ($1,200 if married filing jointly).

True False

2. You may be able to deduct mortgage insurance premiums you paid after 2006.

True False

3. The 2007 personal exemption amount is the same for all taxpayers regardless of the amount of their adjusted gross income.

True False

4. You cannot deduct a cash contribution, regardless of the amount unless you keep a record of the contribution.

True False

5. The federal telephone excise tax credit was available only on your 2006 return. If you filed but did not request it on the your 2006 return, file Form 1040X.

True False

6. If you have any unused minimum tax credit carry forward from 2004 or earlier years, you may qualify for a refund of part or all of the credit amount, even if the amount of your current year credit is more than your tax liability.

True False

7. The charitable mileage rate increased to 18 cents per mile on September 1, 2007.

True False

8. The maximum amount of net earnings subject to self-employment taxes in 2007 is $90,000.

True False

9. Special depreciation allowances are available to taxpayers in the Liberty Zone or the Gulf Opportunity (GO) Zone for placing assets in service in 2007.

True False

10. For 2007, a qualifying high deductible health plan (HDHP) must have a deductible of at least $550 for self-only coverage.

True False

11. The maximum amount of income you can earn and still get the earned income credit has increased. If you have more than one qualifying child, you may be able to take the credit if you earned less than

a. $37,783 ($30,783 if married filing jointly).
b. $33,241 ($35,241 if married filing jointly).
c. $12,590 ($14,590 if married filing jointly).
d. None of the above.

12. The maximum investment income for purposes of determining eligibility for earned income credit is:

a. $2,800.
b. $3,050.
c. $2,700.
d. $2,950.

13. The maximum amount of wages subject to the social security tax for 2007 is

a. No limit.
b. $ 97,500.
c. $ 102,000.
d. $ 110,000.

14. The maximum deferral contribution to a 401(k) plan for a taxpayer age 45 for tax year 2007 is:

a. $ 15,000.
b. $ 15,500.
c. $ 18,000.
d. $ 19,000.

15.  The limit on the exclusion for payments made on a per diem or other periodic basic under a long-term care insurance contract increased for 2007 to $ 360 per day.

True False

16. The long-term care insurance premium limitation for a taxpayer who is 62 for tax year 2007 is:

a. $ 550.
b. $ 1,110.
c. $ 2,950.
d. $ 3,680.

17. What is the standard mileage rate of deduction for the business use of a vehicle in 2007?

a. 43.5 cents/mile.
b. 48.5 cents/ mile.
c. 44.5 cents/mile.
d. 41.5 cents/mile.

18. The social security wage cap for tax year 2007 is:

a. $ 97,500.
b. $ 89,500.
c. $ 90,000.
d. $ 110,000.

19. For 2007, the amount at which the exemption amount phases out for head of household is

a. $ 117,300.
b. $ 156,400.
c. $ 195,500.
d. $ 234,600.

20. The following credits are no longer allowed against the AMT and a new tax liability applies.

a. child and dependent care expenses and credit for the elderly or disabled.
b. education credits and residential energy credits.
c. mortgage interest credit and the District of Columbia first-time homebuyer credit.
d. All of the above.

21. What is the maximum section 179 expense deduction for 2007?

a. $ 115,000.
b. $ 108,000.
c. $ 125,000.
d. $ 250,000.

22. Your contributions to your HSA are not longer limited to your annual health plan deductible.

True False

23. The annual exclusion for gifts made to spouses who are not U.S. citizens has increased to

a. $ 95,000.
b. $ 110,000.
c. $ 125,000.
d. $ 10,000.

24. For 2007, the maximum adoption credit has increased to $11,390.

True False

25.  If you have any unused minimum tax credit carry forward from 2004 or earlier years, you may qualify for a refund or part or all of the credit amount, even if the amount of your current year credit is more than your total tax liability.

True False

26. Meningoccal and human Papillomavirus vaccines are taxable for sales or uses after January 31, 2007.

True False

27. After January 30, 2007, qualified blood collector organizations are exempt from the heavy highway vehicle use tax on qualified blood collector vehicles.

True False

28. The foreign earned income exclusion for 2007 is:

a. $ 85,700.
b. $ 90,000. 
c. $ 82,400.
d. $ 115,000.

29. If you work part-time and have to pay for care weekly, monthly, or in another way that includes both days worked and days not worked, you can figure your child and dependent care credit including the expenses paid for days not worked. Any day when you work for at least 15 minutes is a day of work.

True False

30. In most cases, no AMT adjustment is required for the deduction of qualified mortgage insurance premiums.

True False

31. Effective for taxable years beginning on or after January 1, 2007, RDPs under California law must file their California income tax returns using either the married/RDP filing jointly or married/RDP filing separately filing status.

True False

32.  California does not conform to the Federal Heroes Earned Retirement Opportunities Act that allows members of the Armed Forces serving in a combat zone to make contributions to their individual retirement plans even if the compensation on which such contribution is based is excluded from gross income.

True False

33. Beginning with the 2007 tax forms, round cents to the nearest whole dollar. For example, round $ 50.50 up to $ 51 or round $ 25.49 down to $ 25. If you do not round, FTB will

a. not process your return.
b. round for you.
c. disregard the cents.
d. send you a letter telling you there was an error.

34. You can request a direct deposit refund on your tax return

a. only if you e-file.
b. only if you paper-file.
c. whether you e-file or file a paper return.
d. None of the above.

35. The Teacher Retention Credit has been repealed for taxable year 2007. 

True False

36. If you are married and your income is only form wages, you may qualify for Ready-Return. It simplifies the filing process.

True False

37. When California conforms to federal tax law changes, it always adopts all of the changes made at the federal level.

True False

38. The personal exemption amounts changed from 2006 to 2007:

a. Increased to $91.
b. Decreased to $91.
c. Increased to $94.
d. Increased to $294.

39. The dependent exemption amounts from 2006 to 2007:

a. Increased to $94.
b. Decreased to $91.
c. Remained the same at $91.
d. Increased to $294.

40. Your California standard deduction for single amounts from 2006 to 2007:

a. Increased to $3,410.
b. Increased to $3,516.
c. Remained the same at $6,820.
d. Increased to $7,032