SAVING INCENTIVES FOR LOW- AND MIDDLE-INCOME FAMILIES: EVIDENCE FROM A FIELD EXPERIMENT WITH H&R BLOCK* ESTHER DUFLO WILLIAM GALE JEFFREY LIEBMAN PETER ORSZAG EMMANUEL SAEZ We analyze a randomized experiment in which 14‚000 tax filers in H&R Block offices in St. Louis received matches of zero‚ 20 percent‚ or 50 percent of IRA contributions. Take-up rates were 3 percent‚ 8 percent‚ and 14 percent‚ respectively. Among contributors‚ contributions‚ excluding the match‚ averaged $765 in the control group
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Economic benefit doctrine – Occurs when one receives a tax benefit from deduction and later receives reimbursement‚ it must be picked up as income (taxable) {Chapter 4} (will be on Homework ES and needs multiple questions) Applies to cash basis taxpayer; Income is taxable to the recipient when it is set aside on his behalf‚ made available to him‚ or is used to satisfy some of his indebtedness . A very narrow exception exists if to take possession of that income would result in undue hardship.
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$11‚900‚ the greater of itemized deductions or the standard deduction of $11‚900. c. $17‚000 = $36‚500 – 11‚900 – (2 x $3‚800). (LO 1.3) 3. a. $23‚000. b. $5‚950‚ the greater of total itemized deductions or the standard deduction amount. c. $13‚250 = $23‚000 – 5‚950 – 3‚800. (LO 1.3) 4. a. $52‚700 = $54‚000 + 1‚700 – 3‚000 ($7‚000 capital loss limited to $3‚000) b. $5‚950 c. $3‚800 d. $42‚950 = $52‚700 – 5‚950 – 3‚800 (LO 1.3) 5. Gross income – Deductions for adjusted gross income = Adjusted
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CHAPTER 1 INTRODUCTION TO TAXATION SOLUTIONS TO PROBLEM MATERIALS Status: Q/P Question/ Present in Prior Problem Topic Edition Edition 1 Effect of state and local taxes on decision making Unchanged 1 2 Tax structure Unchanged 3 3 Proportional versus progressive tax Unchanged 14 4 FICA and FUTA compared Unchanged 15 5 Use taxes Unchanged 4 6 Cumulative nature of the Federal gift tax Unchanged 6 7 Federal
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Chapter 5—Introduction to Business Expenses 1. Tina‚ Terri‚ and Tricia operate Capstone Fashions an exclusive boutique. e. $140‚000 2. To be deductible‚ the dominant motive for incurring an expense must be d. the intent to earn a profit. 3. Which of the following is an example of a business purpose as dominant motive? b. Only statement II is correct. 4. The Business Purpose Concept means c. Both statements are correct. 5. The legislative grace concept
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as mitigating the effect of the annual accounting period concept. by social considerations. as promoting administrative feasibility. None of the above 5. (TCO 8) Which‚ if any‚ of the following items is a deduction for AGI? (Points : 2) Moving expenses Union dues Child support payments Tax return preparation fee None of the above 6. (TCO 8) Elton and Elsie are husband and wife and file a joint return for 2011.
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MEMORANDUM TO: Dr. Green FROM: Kecia Carter DATE: November 28‚ 2010 RE: Tax Memo #1/Gambling Activities Issue #1 Dr. Green is a practicing physician in Chicago who‚ as an avid blackjack and slot machine player‚ travels to Las Vegas bi-weekly to gamble. He would like to know what criteria are used to determine whether his gambling activities constitute a trade or business for federal income tax purposes and whether or not you think his gambling activities qualify for trade or
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Chapter I:4 Gross Income: Exclusions Discussion Questions I:4-1 The IRS and the courts must interpret the tax law passed by Congress. The efforts of the IRS and the courts may result in broad definitions of certain exclusions. Such broad definitions may reasonably be termed administrative or judicial exclusions. Administrative exclusions are those that are developed by the Treasury Department and IRS through Regulation‚ rulings‚ etc. Judicial exclusions are the result of court decisions
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Tax Research Exercise 1 1) 147(c)(2)(C)(iii)Insolvent farmer.—For purposes of clause (i)‚ farmland which was previously owned by the individual and was disposed of while such individual was insolvent shall be disregarded if section 108 applied to indebtedness with respect to such farmland. 2) Federal Tax Regulations‚ Regulation‚ §1.351-1.‚ Internal Revenue Service‚ Transfer to corporation controlled by transferor Click to open document in a browser Reg. § 1.351-1 does not reflect P
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References: Business or Hobby? Answer Has Implications for Deductions. (n.d.). ed www.irs.gov McGovern‚ G.‚ Tracy Gaspardo Mortenson‚ & Mark‚ L. (2010). Editors. Chicago‚ IL: CCH a Wolters Kluwer business. Smith‚ E. P.‚ Harmelink‚ P. J.‚ & Hasselback‚ J. R. (2010). Editors. Chicago‚ IL: CCH a Wolter Kluwber business
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