Personal Income Tax Essentials Quiz

Test your knowledge of personal income tax essentials in the U.S. with these quiz questions covering forms, deductions, credits, and more!

Practice Learn Test

Which of the following forms is used to file personal income taxes in the United States?

Form W-2

Form 1040

Form 1099

Form W-9

What is the term for income earned from sources other than employment?

Gross income

Adjusted gross income

Passive income

Earned income

What is the purpose of a tax deduction?

To increase taxable income

To decrease taxable income

To increase tax rates

To decrease tax rates

Which of the following is a tax credit?

Standard deduction

Exemption

Child tax credit

Mortgage interest deduction

What is the term for income that is not subject to taxation?

Taxable income

Gross income

Tax-exempt income

Adjusted gross income

Which of the following is NOT a tax-deductible expense for self-employed individuals?

Health insurance premiums

Office rent

Entertainment expenses

Business travel expenses

Which of the following is NOT a deductible expense for personal income tax purposes in the United States?

Mortgage interest

Charitable contributions

Medical expenses

Vacation expenses

What is the purpose of claiming 'dependents' on a tax return?

To increase the standard deduction

To decrease the taxable income

To qualify for certain tax credits

To eliminate the need to file a tax return

What is the penalty for failing to file a tax return by the deadline in the United States?

Interest on unpaid taxes

Late payment penalty

Failure to file penalty

All of the above

#10

Which of the following is NOT a form of income subject to federal income tax in the United States?

Salary

Dividends

Child support payments

Capital gains

#11

What is the penalty for early withdrawal from a traditional IRA (Individual Retirement Account)?

10% penalty

5% penalty

20% penalty

No penalty

#12

Which of the following is NOT a characteristic of a Roth IRA?

Contributions are tax-deductible

Qualified distributions are tax-free

No required minimum distributions

Contributions can be withdrawn at any time

#13

Which of the following is NOT a tax-filing status in the United States?

Married filing jointly

Single

Head of household

Married filing separately

#14

What is the maximum contribution limit for a traditional IRA (Individual Retirement Account) in 2021?

$5,500

$6,000

$7,000

$8,000

#15

What is the maximum amount of capital losses that can be deducted against ordinary income in a tax year in the United States?

$3,000

$5,000

$10,000

No limit

#16

What is the penalty for not paying enough estimated taxes throughout the year in the United States?

Interest on unpaid taxes

Late payment penalty

Failure to pay penalty

All of the above

#17

Which of the following is a requirement to be eligible for the Child Tax Credit in the United States?

Having a dependent child under age 18

Being a single filer

Having a high income

Not having any other tax credits