Free SEE Part 1 sample questions
Here are five free SEE Part 1 questions with explained answers, one each from five of the six domains. They are original, scenario-based questions written at the level of the official content outline, not real exam items. Like the exam, they assume tax year 2025 unless stated otherwise, and each has four options and one best answer.
Try each question before you open the answer. If you can explain why the three wrong options are wrong, you know the rule well enough for the exam.
Question 1. Dana is unmarried. Her 10-year-old son lived with her all year and is her qualifying child. Dana paid more than half the cost of keeping up the home. Which filing status gives Dana the lowest tax that she is entitled to use?
- A. Single
- B. Head of household
- C. Qualifying surviving spouse
- D. Married filing separately
Show answer
Answer: B
Head of household requires the taxpayer to be unmarried (or considered unmarried), to pay more than half the cost of keeping up a home, and to have a qualifying person living there for more than half the year. Dana meets all three, and head of household has a larger standard deduction and wider brackets than single. Qualifying surviving spouse requires a spouse who died in one of the two previous years, and married filing separately requires a spouse.
Question 2. Marco received shares as a gift. The donor's adjusted basis was $10,000 and the fair market value on the date of the gift was $6,000. No gift tax was paid. Marco later sells the shares for $8,000. What is Marco's gain or loss?
- A. $2,000 gain
- B. $2,000 loss
- C. $4,000 loss
- D. No gain or loss
Show answer
Answer: D
When the fair market value at the date of the gift is below the donor’s basis, the donee uses the donor’s basis to calculate gain and the fair market value to calculate loss. Using $10,000, the sale produces a $2,000 loss, not a gain. Using $6,000, it produces a $2,000 gain, not a loss. When the sale price falls between the two figures, there is no gain and no loss.
Question 3. Priya and her husband both work full time. Which of the following payments qualifies for the child and dependent care credit for their 8-year-old son?
- A. A summer day camp while both parents are at work
- B. An overnight summer camp
- C. Private school tuition for third grade
- D. Payments to their 17-year-old daughter for after-school babysitting
Show answer
Answer: A
The cost of a day camp that cares for a child under 13 while the parents work is a qualifying expense. Overnight camp is specifically excluded. Tuition for kindergarten and higher grades is education, not care. Payments to the taxpayer’s own child who is under 19 at the end of the year do not qualify, even though the older sibling is doing the care.
Question 4. Which of the following is NOT included in net investment income for the net investment income tax?
- A. Qualified dividends from a US corporation
- B. Net rental income from a residential rental property
- C. A distribution from a traditional IRA
- D. Gain on the sale of publicly traded stock
Show answer
Answer: C
Distributions from qualified retirement plans and IRAs are excluded from net investment income, although they can raise modified AGI and push other income over the threshold. Dividends, rental income (unless earned in a non-passive trade or business) and gain on the sale of stock are all standard examples of net investment income.
Question 5. In 2025, Tom made a large cash gift to his nephew from his own account. Tom and his wife Lena, both US citizens, want to treat the gift as made one half by each of them. Which statement is correct?
- A. Gift splitting applies automatically to any couple filing a joint income tax return
- B. Tom and Lena file one joint Form 709 covering both spouses
- C. Both spouses consent to split the gift, which is shown on Form 709, even if no gift tax is owed
- D. The gift can be split only if it was paid from a joint bank account
Show answer
Answer: C
Gift splitting is elective. Both spouses must consent, and the consent is made on Form 709. Generally each spouse must then file a Form 709, even if no gift tax is owed, because there is no joint gift tax return. Filing a joint income tax return does not split gifts automatically, and it does not matter which account the money came from.
How did you do?
Look at the pattern in these five. None of them depends on remembering a 2025 dollar figure; each tests a rule and whether you can apply it to the facts. That reflects the real exam well. Figures matter, but most marks come from knowing which rule applies and how.
- Question 1 is about identifying the filing status first. Many exam questions depend on it, often without saying so.
- Question 2 is the dual-basis rule for gifted property, one of the most tested basis traps.
- Question 3 is about exceptions. Credit questions often turn on what is specifically excluded.
- Question 4 is written in the EXCEPT/NOT form. Mark each option true or false before you answer.
- Question 5 is about procedure: who files what, and when.
Four or five correct: go to the 20-question practice test. Fewer: start the 8-week study plan and read the domain guides, beginning with income and assets.