Tax Deductions and Form 1040 Quiz

All income received, including wages, salary, interest, dividends, and capital gains, before any deductions are taken.

Deductions that are subtracted directly from gross income to arrive at adjusted gross income (AGI).

The amount of income remaining after subtracting deductions for adjusted gross income from gross income.

Deductions that are taken after adjusted gross income (AGI) has been calculated, such as medical expenses, charitable contributions, and state and local taxes.

The amount of income subject to taxation; calculated by subtracting the greater of itemized deductions or the standard deduction from adjusted gross income.

A fixed amount that taxpayers can deduct in lieu of itemizing deductions. The amount varies based on filing status, age, and blindness.

A list of specific deductible expenses that taxpayers can choose to claim instead of the standard deduction.

The amount of tax liability after deductions and credits are considered.

Types of income that are excluded from gross income and not subject to taxation, examples include child support payments, inheritances, and interest from municipal bonds.

Income from wages, salaries, tips, bonuses, and other forms of compensation for services performed.

Income from selling an asset for more than its original cost.

Payments made under a court-ordered separation or divorce agreement.

Regular payments made to an individual over a period of time, often after retirement or as a result of an accident.

Income generated from business activities, such as sales, services, or rentals.

Payments received for services performed by a member of the clergy.

Payments received for interest on money lent or deposited.

Payments received from ownership of stocks, bonds, or other investments.

Income earned from playing games of chance, such as lotteries, gambling, or poker.

Income received from renting out property, such as a house, apartment, or land.

Income received from royalties, such as those earned from writing a book, creating a song, or inventing a product.

A deduction for medical expenses, such as doctor's visits, prescription drugs, and medical insurance premiums.

A deduction for contributions to charitable organizations, such as churches, schools, and hospitals.

A deduction for state and local taxes, such as income tax, sales tax, property tax, and real estate taxes.

Deductions from AGI that are related to activities that produce income, such as investment expenses, certain tax preparation fees, and legal fees incurred in generating rental income.

A deduction for contributions to Traditional Individual Retirement Accounts (IRAs) and other qualified retirement plans.