Principles of Real Estate Ch.14 (Quiz 14)

The homeowners exemption, excluding local assessments, saves approximately how much in property taxes?

1) $100

2) $80

3) $70

4) $40

3) $70

The proposition that allows certain homeowners to transfer their property tax base to another home is:

1) Proposition 13

2) Proposition 15

3) Proposition 19

4) Proposition 58

3) Proposition 19

For a homeowner, which of the following is tax deductible?

1) Fire insurance premiums

2) Roof repairs

3) Mortgage interest

4) Two of the above are deductible for homeowners

3) Mortgage interest

City Council members:

1) Establish property assessed values

2) Are responsible for collecting property taxes

3) Establish city budgets

4) Determine market values of properties

3) Establish city budgets

The second installment of real property taxes is delinquent if not paid by:

1) November 1

2) December 10

3) February 1

4) April 10

4) April 10

The seller's current real estate tax is $1,175 per year including the homeowner's exemption. The condo is sold to a buyer for $197,500. Assuming no local assessments are added to the tax bill, what will be the buyer's real property tax bill including the homeowner's exemption?

1) $1,975

2) $1,905

3) $1,175

4) $1,050

2) $1,905

Which of the following is true?

1) A person cannot use a homeowner's exemption and the veteran's exemption on the same home

2) Real property taxes become a lien on the first Monday in March

3) A 12% penalty is added for delinquent property taxes

4) California has special property tax exemptions for senior citizens 45 years or older

1) A person cannot use a homeowner's exemption and the veteran's exemption on the same home

A property was valued at $500,000 for property tax purposes. According to proposition 13 what would be the maximum value for property tax purposes in two years, assuming the owner did not make capital improvements?

1) $502,420

2) $504,010

3) $506,220

4) $520,200

4) $520,200

A frequently used special assessment law is:

1) The Street Improvement Act of 1911

2) The Mell-Roos Community Facilities Act of 1982

3) Proposition 13

4) Proposition 19

1) The Street Improvement Act of 1911

Under certain conditions, married couples may exempt up to how much in gains from the sale of a home?

1) $500,000

2) $250,000

3) $125,000

4) $50,000

1) $500,000

When foreigners sell U.S. property, the Foreign Investment in Real Property Tax Act (FIRPTA) may require what percentage to be withheld from the sale proceeds?

1) 3 1/3%

2) 5%

3) 15%

4) 25%

3) 15%

Property taxes become a lien on:

1) July 1

2) November 1

3) February 1

4) January 1

4) January 1

Private property is deeded to the state for delinquent property taxes after:

1) 1 year

2) 2 years

3) 3 years

4) 5 years

4) 5 years

When a special assessment is made on a piece of property under the Street Improvement Act of 1911:

1) Property owner can deduct principal and interest

2) It is based on the front footage of the property

3) It is appraised as per the amount of square footage

4) Assessment must be paid within six months

2) It is based on the front footage of the property

In a 1031 real estate exchange, a tax liability arises if the person exchanging receives:

1) Like kind property

2) Boot

3) Income property

4) Investment property

2) Boot

The amount paid as a commission for the sale of an owner-occupied home can be deducted on the seller's federal income tax as:

1) A long–term capital gain

2) A standard deduction

3) And expense of sale

4) An ordinary loss

3) And expense of sale

Under certain conditions, a single homeowner may exempt up to how much in gains from the sale of a home?

1) $500,000

2) $300,000

3) $250,000

4) $125,000

3) $250,000

This event could trigger a new property tax assessment:

1) A refinance by the current owner

2) A real estate transfer

3) A construction loan

4) The rental of a single family residence

2) A real estate transfer

Ad valorem, is a Latin phrase that means:

1) According to value

2) Buyer beware

3) And others

4) None of the above

1) According to value

The county tax assessor's duty is to determine:

1) The tax rate to be applied to assessed values

2) Assignment of parcel numbers to current secured tax rolls

3) Tax to be paid by the property owner

4) Value of the property for tax purposes

4) Value of the property for tax purposes

A law used to finance public services in newly developed areas that can lead to high assessments for the affected owners is called:

1) Mello-Roos

2) Holden-Aspen

3) Alvareze-Greene

4) Brown-Miller

1) Mello-Roos

For investors, losses on the operation of rental real estate are what type of losses?

1) Passive

2) Active

3) Actual

4) Portfolio

1) Passive

Property owners can appeal the size of their property tax bill to an assessments appeals commission, or in some areas to the:

1) Local board of equalization

2) Franchise tax board

3) Board of supervisors

4) Franchise property tax agency

1) Local board of equalization

Federal income taxes are referred to as a:

1) Progressive tax

2) Regressive tax

3) Proportionate tax

4) Equalized tax

1) Progressive tax

An investor who has owned a property for two years and then sells for a gain most likely will:

1) pay capital gains taxes

2) Defer the payment of taxes

3) Pay only California, not federal taxes

4) Not pay taxes as a sale for cash qualifies as a 1031 exchange

1) pay capital gains taxes

To qualify for installment sale reporting, a seller must:

1) Trade up to a more expensive property

2) Carry paper

3) Acquire like four like property

4) Receive no boot

2) Carry paper

A and B have purchased agricultural land as joint tenants. A is farming the entire plot, while B is using no part of it. Regarding property taxes:

1) A is liable for all the taxes

2) B is not liable for any taxes

3) B is liable for one-half of the taxes

4) Both owners are liable for taxes

4) Both owners are liable for taxes

Which can be depreciated for income tax purposes?

1) An owner-occupied condominium unit

2) Rental property

3) Vacant land

4) An owner–occupied single–family residence

2) Rental property

Since the passage of proposition 13, the county tax assessor is required to value property for real property taxes on the basis of the:

1) Fair loan value

2) Adjusted book value

3) Current market value

4) Full cash value

4) Full cash value

Federal income taxes on the sale of income property can be deferred by which of the following methods?

1) All cash sale

2) 1031 exchange

3) Installment sales

4) Both (b) and (c)