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Match the statements that relate to each other. Note: Choice l. may be used more than once. -Gain on collectibles (held more than one year)


A) Available to a 70-year-old father claimed as a dependent by his son.
B) Equal to tax liability divided by taxable income.
C) The highest income tax rate applicable to a taxpayer.
D) Not eligible for the standard deduction.
E) No one qualified taxpayer meets the support test.
F) Taxpayer's ex-husband does not qualify.
G) A dependent child (age 18) who has only unearned income.
H) Highest applicable rate is 39.6%.
I) Applicable rate could be as low as 0%.
J) Maximum rate is 28%.
K) Income from foreign sources is not subject to tax.
L) No correct match provided.

M) F) and H)
N) D) and I)

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Under the income tax formula, a taxpayer must choose between deductions for AGI and the standard deduction.

A) True
B) False

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If an individual does not spend funds that have been received from another source (e.g., interest on municipal bonds), the unexpended amounts are not considered for purposes of the support test.

A) True
B) False

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A decrease in a taxpayer's AGI could increase the amount of medical expenses that can be deducted.

A) True
B) False

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When can a taxpayer not use Form 1040EZ? Form 1040A?

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Form 1040EZ cannot be used when the taxp...

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Regarding the rules applicable to filing of income tax returns, which, if any, of the following is an incorrect statement:


A) Married persons who file joint returns cannot later (after the due date of the return) substitute separate returns.
B) Married persons who file separate returns can later (after the due date of the return) substitute a joint return.
C) The usual test as to when a taxpayer must file a return is based on the total of the following: personal exemption + basic standard deduction + both additional standard deductions.
D) Special filing requirement rules exist for taxpayers who are claimed as dependents of another.
E) None of these.

F) B) and D)
G) A) and B)

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Using borrowed funds from a mortgage on her home, Leah provides 52% of her own support, while her sons furnished the rest. Leah can be claimed as a dependent under a multiple support agreement.

A) True
B) False

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Regarding dependency exemptions, classify each statement in one of the four categories: -A half-brother who lives with taxpayer.


A) Could be a qualifying child.
B) Could be a qualifying relative.
C) Could be either a qualifying child or a qualifying relative.
D) Could be neither a qualifying child nor a qualifying relative.

E) All of the above
F) B) and C)

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Edgar had the following transactions for 2016: What is Edgar's AGI for 2016? Edgar had the following transactions for 2016: What is Edgar's AGI for 2016?

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$150,000. $80,000 (salary) - $4,000 (ali...

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Meg, age 23, is a full-time law student and is claimed by her parents as a dependent. During 2016, she received $1,400 interest income from a bank savings account and $6,100 from a part-time job. What is Meg's taxable income for 2016?

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$1,200. Meg's standard deduction is the ...

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Homer (age 68) and his wife Jean (age 70) file a joint return. They furnish all of the support of Luther (Homer's 90-year old father), who lives with them. In 2016, they received $6,000 of interest income on city of Chicago bonds and interest income on corporate bonds of $48,000. Compute Homer and Jean's taxable income for 2016.

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$20,750. Their gross income is $48,000 s...

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Once they reach age 65, many taxpayers will switch from itemizing their deductions from AGI and start claiming the standard deduction.

A) True
B) False

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Match the statements that relate to each other. Note: Choice l. may be used more than once. -Additional standard deduction


A) Not available to 65-year old taxpayer who itemizes.
B) Exception for U.S. citizenship or residency test (for dependency exemption purposes) .
C) Largest basic standard deduction available to a dependent who has no earned income.
D) Considered for dependency exemption purposes.
E) Qualifies for head of household filing status.
F) A child (age 15) who is a dependent and has only earned income.
G) Considered in applying gross income test (for dependency exemption purposes) .
H) Not considered in applying the gross income test (for dependency exemption purposes) .
I) Unmarried taxpayer who can use the same tax rates as married persons filing jointly.
J) Exception to the support test (for dependency exemption purposes) .
K) A child (age 16) who is a dependent and has only unearned income of $4,500.
L) No correct match provided.

M) B) and D)
N) I) and L)

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In which, if any, of the following situations will the kiddie tax not apply?


A) The child is married but does not file a joint return.
B) The child has unearned income of $2,100 or less.
C) The child has unearned income that exceeds more than half of his (or her) support.
D) The child is under age 24 and a full-time student.
E) None of these.

F) D) and E)
G) C) and E)

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Kim, a resident of Oregon, supports his parents who are residents of Canada but citizens of Korea. Kim can claim his parents as dependents.

A) True
B) False

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Surviving spouse filing status begins in the year in which the deceased spouse died.

A) True
B) False

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Regarding dependency exemptions, classify each statement in one of the four categories: -A granddaughter, who lives with taxpayer, is 19 years old, earns $5,000, and is not a full-time student.


A) Could be a qualifying child.
B) Could be a qualifying relative.
C) Could be either a qualifying child or a qualifying relative.
D) Could be neither a qualifying child nor a qualifying relative.

E) None of the above
F) B) and D)

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In satisfying the support test and the gross income test for claiming a dependency exemption, a scholarship received by the person being claimed is handled the same way for each test. Do you agree or disagree with this statement? Why?

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Disagree. For purposes of the support te...

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All exclusions from gross income are reported on Form 1040.

A) True
B) False

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Match the statements that relate to each other. Note: Choice l. may be used more than once. -Kiddie tax does not apply


A) Not available to 65-year old taxpayer who itemizes.
B) Exception for U.S. citizenship or residency test (for dependency exemption purposes) .
C) Largest basic standard deduction available to a dependent who has no earned income.
D) Considered for dependency exemption purposes.
E) Qualifies for head of household filing status.
F) A child (age 15) who is a dependent and has only earned income.
G) Considered in applying gross income test (for dependency exemption purposes) .
H) Not considered in applying the gross income test (for dependency exemption purposes) .
I) Unmarried taxpayer who can use the same tax rates as married persons filing jointly.
J) Exception to the support test (for dependency exemption purposes) .
K) A child (age 16) who is a dependent and has only unearned income of $4,500.
L) No correct match provided.

M) A) and H)
N) A) and E)

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