Solution Manual for Fundamentals of Taxation 2019 Edition 12th Edition By Cruz

Solution Manual for Fundamentals of Taxation 2019 Edition 12th Edition By Cruz Solutions Manual CHAPTER 1 – SOLUTIONS END OF CHAPTER MATERIAL Discussion Questions 1. (Introduction) Give a brief history of the income tax in the United States. Answer: The first federal income tax was enacted in 1861 to help finance the Civil War and was discarded soon thereafter. In 1894, another income tax was promulgated by Congress to raise additional tax revenue and to expand the sources of revenue. In 1895, the Supreme Court ruled that the federal income tax was unconstitutional. In 1913, the sixteenth Amendment to the U.S. Constitution was enacted. This amendment gave Congress the power to levy and collect taxes. In 2016, the federal government collected about $1.45 trillion in individual income taxes. Feedback: Learning Objective: Introduction Topic: Income tax history Difficulty: 1 Easy EA: No 2. (Introduction) For tax year 2016 what proportion of individual income tax returns was filed on a Form 1040EZ, Form 1040A and Form 1040? What proportion was electronically filed? Answer: In 2016, 15.9% of individual income tax returns were filed using a Form 1040EZ, 26.8% using a Form 1040A, and 57.3% using a Form 1040. Electronically-filed tax returns were 88.1% of total returns. Feedback: Calculated from Table 1-1 Learning Objective: Introduction Topic: Income tax data Difficulty: 2 Medium EA: No 3. Name the three types of tax rate structures and give an example of each. Answer: Progressive – U.S. federal income tax Proportional – “flat-tax” usually levied on property or sales at the state or local level