2012 Federal Income Tax Quiz

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2012 Federal Income Tax Quiz

How well do you know tax facts?

As April is tax month, included here is a short quiz to see how well you know your Federal Income Tax History and Fun Facts. Enjoy!
	What Famous Character Successfully Sold Filing 1040s to the American Public?
	Donald Duck. In a famous cartoon produced in 1943, Donald successfully promoted filing individual income taxes to the public. Before this time, most income taxes were paid only by the upper class. See the video
	The Alternative Minimum Tax (AMT) was introduced to catch some wealthy taxpayers using loopholes to avoid paying taxes in 1969. How many taxpayers were there that stimulated Congress to act?
	155 taxpayers. Today over 3.5 million taxpayers will pay the AMT with a potential 20+ million more to be impacted if the current AMT "patch" is not extended.
	In a recent estate tax case, a painting valued by the estate at zero was assessed a tax of over $29 million with an $11 million penalty. Why?
	The estate of Ileana Sonnenbend, an avid art collector, contained a 1959 abstract work of art called "Canyon" by Robert Rauschenberg. The art contained a stuffed bald eagle, which is illegal to own, export or sell. Ileana had received permission to retain the art by the U.S. Department of Fish and Wildlife, since she could prove the eagle had died prior to the Bald Eagle Protection Act. Part of the agreement with Ms. Sonnenbend was that the painting could not be sold and it could not leave the country. The IRS' position? The estate could sell the painting on the black market to a rich recluse Chinese billionaire that might like to buy it and hide it.
	Which of the following deductions were allowed by the IRS? a: Free beer given to customers by a service station b: Cost of a back yard swimming pool as a necessary medical expense c: Scrap yard's deduction for cat food d: All of the above
	d. All of the above. Each of the above deductions were ultimately allowed by tax court decisions. Thinking of taking a similar deduction? Think again. Each case was unique in the eyes of the Tax Court and similar deductions must be able to stand on their own merits.