1. Which of the following statements are false?
1. The FICA tax (Medicare component) on wages is progressive since the tax due increases as wages increase.
2. According to the IRS, economic income is not considered to be realized income.
3. The IRS will pay interest to a taxpayer on their tax refund if it is not received within 45 days of when the taxpayer filed his/her return.
4. The most recent codification of the Internal Revenue Code occurred in 2013.
5. According to the IRS, income is taxed when it realized.
2. Which of the following statements are true?
1. Special interest dealings do occur in the creation of federal tax law.
2. Under the accrual method of accounting for taxes, income is recognized in the year it is actually received in cash or cash equivalent.
3. Revenue Rulings are accumulated in the Cumulative Bulletins.
4. One of the objectives of the federal tax law is to achieve equity across taxpayers.
5. Under the accrual method of accounting for taxes, interest income is recognized in the year it is received.