Real Estate Exam Federal Law Practice Test 2025 Question Answers

1) Federal income tax deductions for a principal residence include:

2) Indications of independent contractor status include:

3) Where the dominant population base of an area consists of minorities:

4) Federal income tax rates are generally:

5) Taxable gain on the sale of commercial real estate is calculated by:

6) The initial cost of an asset, increased by capital expenditures and reduced by depreciation expenses, from which gain or loss is measured is:

7) A REIT is like:

8) A Real Estate Investment Trust (REIT) must:

9) A tax deduction for business property that requires no cash outlay is:

10) A seller asks his broker about the race of a potential buyer. The broker:

11) Instead of selling business or investment property and paying a tax on the gain, one may prefer:

12) The two most important income tax deductions for homeowners are:

13) The two most important income tax deductions for homeowners are:

14) Federal income tax deductions for a principal residence include:

15) “Familial status” refers to:

16) The federal income tax exemption on the gain from the sale of a personal residence held long enough by a married couple is up to:

17) Cash or other unlike property included to equalize values in a Section 1031 exchange is called:

18) No federal fair housing laws are violated if a landlord refuses to rent to:

19) A homeowner, on their federal income tax return, may not deduct:

20) Broker Barb is acting as a buyer’s agent for Joe. Joe asks whether any people of a certain race live in a specific neighborhood. How should Barb respond?

21) The federal income tax exemption on the gain from the sale of a personal residence held long enough by a single individual is up to:

22) Depreciation claimed for income tax purposes:

23) A tax deduction for business property that requires no cash outlay is:

24) Mr. and Mrs. Martin jointly bought a principal residence in 2004 for $325,000 and sold it in 2016 for $500,000. What portion of their $175,000 gain is subject to capital gains tax?

25) Owners of improved rental property can generally deduct on their federal income tax returns in the year incurred:

26) Harold bought 20 acres for $125,000 and sold the land three years later for $230,000. On his income tax return, he reports:

27) In the purchase of a home, which is frequently tax-deductible?

28) Which of the following is exempt from the federal Fair Housing Act of 1968?

29) Sullivan wants to rent an apartment but is confined to a wheelchair. At Sullivan’s request, the landlord must:

30) A Real Estate Investment Trust (REIT) must:

31) A homeowner, on his or her federal income tax return, may not deduct:

32) To qualify as a Section 1031 exchange, the property must be:

33) The Civil Rights Act of 1968 prohibits:

34) The report of a sale to the IRS is normally made on Form 1099 by the:

35) Broker Bob is showing houses to Joe Chen, who is of Chinese ancestry. Bob shows Joe houses in a neighborhood of predominantly Chinese-American residents because Bob thinks Joe would feel more at home there. This is:

36) Ellen owns a two-family house and lives in one side. She wants to advertise the other side as nonsmoking. Can she legally do so?

37) The federal income tax exemption on the gain from the sale of a personal residence held long enough by a single individual is up to:

38) The initial cost of an asset, increased by capital expenditures and reduced by depreciation expenses, from which gain or loss is measured is:

39) The federal income tax exemption on the gain from the sale of a personal residence held long enough by a married couple is up to:

40) Cash or other unlike property included to equalize values in a Section 1031 exchange is called:

41) In a Subchapter S corporation, the corporation itself:

42) If a landlord refuses to rent to a minority prospective tenant with a poor credit record:

43) The 1968 Fair Housing Act, as amended, prohibits housing discrimination on the basis of:

44) Federal income tax rates are generally:

45) Which amendment to the Constitution provides support by banning racial discrimination?

46) Under Internal Revenue Code Section 1031, tax on the profit of an exchange is:

47) A broker has contacted owners in a certain subdivision and advised them that several members of a particular race have bought homes in the area. The broker has offered to list properties at a reduced rate and encouraged the owners to sell quickly. This is:

48) Double taxation is generally not avoided when using which form of ownership?

49) When a salesperson’s agreement with a broker is to be an independent contractor, the broker:

50) Court action may be taken by an individual under the Fair Housing Act: