Question 1

Kyle and Liza are married and under 65 years of age. During 2019, they furnish more than half of the support of their 19-year old daughter, Kendra, who lives with them. She graduated from high school in May 2018. Kendra earns
$15,000 from a part-time job, most of which she sets aside for future college expenses. Kyle and Liza also provide more than half of the support of Kyle's cousin who lives with them. Liza's father, who died on January 3, 2019, at age 90, has for many years qualified as their dependent. How many dependents can Kyle and Liza claim?

Accepted Answer

A)   None
B)   One
C)   Two
D)   ThreeE) B) and D)
F) B) and C)

Question 2

In 2019, Tom is single and has AGI of $50,000. He is age 70, has no dependents, and has itemized deductions (i.e.,
from AGI) of $7,000. Determine Tom's taxable income for 2019.

Accepted Answer

$36,150. Tom's standard deduction is $12...

Question 3

Gain on the sale of collectibles held for more than 12 months always is subject to a tax rate of 28%.

Accepted Answer

A) True 
 B)False

Question 4

Warren, age 17, is claimed as a dependent by his father. In 2019, Warren has dividend income of $1,500 and earns
$400 from a part-time job.
a. What is Warren's taxable income for 2019?
b. Suppose that Warren earned $1,200 (not $400) from the part-time job. What is his taxable income for 2019?

Accepted Answer

a. $800. Warren's standard deduction is ...

Question 5

After her divorce, Hope continues to support her ex-husband's sister, Cindy, who does not live with her. Hope can
claim Cindy as a dependent.

Accepted Answer

A) True 
 B)False

Question 6

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

Accepted Answer

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 in 2019.
D)  Considered for dependency 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) G) and I)
N) D) and G)

Question 7

In 2019, a child who has unearned income of $2,200 or less cannot be subject to the kiddie tax.

Accepted Answer

A) True 
 B)False

Question 8

Katrina, age 16, is claimed as a dependent by her parents. During 2019, she earned $5,600 as a checker at a grocery store. Her standard deduction is $5,950 ($5,600 earned income + $350).

Accepted Answer

A) True 
 B)False

Question 9

In terms of income tax consequences, abandoned spouses are treated the same way as married persons filing separate returns.

Accepted Answer

A) True 
 B)False

Question 10

The basic and additional standard deductions both are subject to an annual adjustment for inflation.

Accepted Answer

A) True 
 B)False

Question 11

Match the statements that relate to each other. Note: Some choices may be used more than once.
-Abandoned spouse

Accepted Answer

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 in 2019.
D)  Considered for dependency 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) F) and H)
N) A) and L)

Question 12

Under what circumstances, if any, may an ex-spouse be claimed as a dependent?

Accepted Answer

As an ex-spouse does not meet the relati...

Question 13

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.

Accepted Answer

A) True 
 B)False

Question 14

During 2019, Marvin had the following transactions:   Salary $50,000 Bank loan (proceeds used to buy personal auto)  10,000 Alimony paid (divorce was finalized in 2010) . 12,000 Child support paid 6,000 Gitt from aunt 20,000\begin{array}{lr}	ext { Salary } & \$ 50,000 \	ext { Bank loan (proceeds used to buy personal auto)  } & 10,000 \	ext { Alimony paid (divorce was finalized in 2010) . } & 12,000 \	ext { Child support paid } & 6,000 \	ext { Gitt from aunt } & 20,000\end{array} Salary  Bank loan (proceeds used to buy personal auto)   Alimony paid (divorce was finalized in 2010) .  Child support paid  Gitt from aunt ​$50,00010,00012,0006,00020,000​  Marvin's AGI is:

Accepted Answer

A)   $32,000.
B)   $38,000.
C)   $44,000.
D)   $56,000.
E)   $64,000. F) None of the above
G) A) and E)

Question 15

In meeting the criteria of a qualifying child for dependency purposes, when if ever, might the child's income become relevant?

Accepted Answer

The amount of income earned by the quali...

Question 16

Regarding head of household filing status, comment on the following:
a. A taxpayer qualifies even though he maintains a household which he and the dependent do not share.
a. If the household is that of a dependent parent, it need not be taxpayer's household.
b. A taxpayer does not qualify even though the person sharing the household is a dependent.
c. The usual eventual filing status of a surviving spouse.

Accepted Answer

b. If the household does not include a d...

Question 17

Which the following, if any, of is a correct statement relating to the kiddie tax in 2019?

Accepted Answer

A)   If the parents are divorced, the income of the noncustodial parent is used to determine the allocable parental tax.
B)   The components for the application of the kiddie tax are not subject to adjustment for inflation.
C)   If the kiddie tax applies, the parents must include the income of the child on their own income tax return.
D)   The kiddie tax does not apply if both parents of the child are deceased.
E)   None of these.F) A) and E)
G) All of the above

Question 18

Match the statements that relate to each other. Note: Some choices may be used more than once.
-Multiple support agreement

Accepted Answer

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 in 2019.
D)  Considered for dependency 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) E) and L)
N) F) and I)

Question 19

Pedro is married to Consuela who lives with him. Both are U.S. citizens and residents of Nebraska. Pedro furnishes all of the support of his parents who are citizens and residents of the United States. He also furnishes all of the support of Consuela's parents who are citizens and residents of El Salvador. Consuela has no gross income for the year. If Pedro and Consuela file as married persons filing jointly, how many dependents can they claim?

Accepted Answer

Two. Only Pedro's parents are ...

Question 20

For the year a spouse dies, the surviving spouse is considered married for the entire year for income tax purposes.

Accepted Answer

A) True 
 B)False

Exam 3: Computing the Tax

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.

Correct Answer
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Katrina, age 16, is claimed as a dependent by her parents. During 2019, she earned $5,600 as a checker at a grocery store. Her standard deduction is $5,950 ($5,600 earned income + $350).

Correct Answer
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In 2019, Tom is single and has AGI of $50,000. He is age 70, has no dependents, and has itemized deductions (i.e., from AGI) of $7,000. Determine Tom's taxable income for 2019.

Correct Answer
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$36,150. Tom's standard deduction is $12...
View Answer

Correct Answer
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b. If the household does not include a d...
View Answer

Correct Answer
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Under what circumstances, if any, may an ex-spouse be claimed as a dependent?

Correct Answer
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As an ex-spouse does not meet the relati...
View Answer

After her divorce, Hope continues to support her ex-husband's sister, Cindy, who does not live with her. Hope can claim Cindy as a dependent.

Correct Answer
verified

In terms of income tax consequences, abandoned spouses are treated the same way as married persons filing separate returns.

Correct Answer
verified

Gain on the sale of collectibles held for more than 12 months always is subject to a tax rate of 28%.

Correct Answer
verified

For the year a spouse dies, the surviving spouse is considered married for the entire year for income tax purposes.

Correct Answer
verified

Correct Answer
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Match the statements that relate to each other. Note: Some choices may be used more than once. -Abandoned spouse

Correct Answer
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Match the statements that relate to each other. Note: Some choices may be used more than once. -Kiddie tax does not apply

Correct Answer
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Warren, age 17, is claimed as a dependent by his father. In 2019, Warren has dividend income of $1,500 and earns $400 from a part-time job. a. What is Warren's taxable income for 2019? b. Suppose that Warren earned $1,200 (not $400) from the part-time job. What is his taxable income for 2019?

Correct Answer
verified
a. $800. Warren's standard deduction is ...
View Answer

Match the statements that relate to each other. Note: Some choices may be used more than once. -Multiple support agreement

Correct Answer
verified

In 2019, a child who has unearned income of $2,200 or less cannot be subject to the kiddie tax.

Correct Answer
verified

In meeting the criteria of a qualifying child for dependency purposes, when if ever, might the child's income become relevant?

Correct Answer
verified
The amount of income earned by the quali...
View Answer

Correct Answer
verified
Two. Only Pedro's parents are ...
View Answer

The basic and additional standard deductions both are subject to an annual adjustment for inflation.

Correct Answer
verified

Which the following, if any, of is a correct statement relating to the kiddie tax in 2019?

Correct Answer
verified

Exam 3: Computing the Tax

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.

Correct AnswerverifiedShow Answer

Katrina, age 16, is claimed as a dependent by her parents. During 2019, she earned $5,600 as a checker at a grocery store. Her standard deduction is $5,950 ($5,600 earned income + $350).

Correct AnswerverifiedShow Answer

In 2019, Tom is single and has AGI of $50,000. He is age 70, has no dependents, and has itemized deductions (i.e., from AGI) of $7,000. Determine Tom's taxable income for 2019.

Correct Answerverified$36,150. Tom's standard deduction is $12...View AnswerShow Answer

Correct Answerverifiedb. If the household does not include a d...View AnswerShow Answer

Correct AnswerverifiedShow Answer

Under what circumstances, if any, may an ex-spouse be claimed as a dependent?

Correct AnswerverifiedAs an ex-spouse does not meet the relati...View AnswerShow Answer

After her divorce, Hope continues to support her ex-husband's sister, Cindy, who does not live with her. Hope can claim Cindy as a dependent.

Correct AnswerverifiedShow Answer

In terms of income tax consequences, abandoned spouses are treated the same way as married persons filing separate returns.

Correct AnswerverifiedShow Answer

Gain on the sale of collectibles held for more than 12 months always is subject to a tax rate of 28%.

Correct AnswerverifiedShow Answer

For the year a spouse dies, the surviving spouse is considered married for the entire year for income tax purposes.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Match the statements that relate to each other. Note: Some choices may be used more than once. -Abandoned spouse

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Warren, age 17, is claimed as a dependent by his father. In 2019, Warren has dividend income of $1,500 and earns $400 from a part-time job. a. What is Warren's taxable income for 2019? b. Suppose that Warren earned $1,200 (not $400) from the part-time job. What is his taxable income for 2019?

Correct Answerverifieda. $800. Warren's standard deduction is ...View AnswerShow Answer

Match the statements that relate to each other. Note: Some choices may be used more than once. -Multiple support agreement

Correct AnswerverifiedShow Answer

In 2019, a child who has unearned income of $2,200 or less cannot be subject to the kiddie tax.

Correct AnswerverifiedShow Answer

In meeting the criteria of a qualifying child for dependency purposes, when if ever, might the child's income become relevant?

Correct AnswerverifiedThe amount of income earned by the quali...View AnswerShow Answer

Correct AnswerverifiedTwo. Only Pedro's parents are ...View AnswerShow Answer

The basic and additional standard deductions both are subject to an annual adjustment for inflation.

Correct AnswerverifiedShow Answer

Which the following, if any, of is a correct statement relating to the kiddie tax in 2019?

Correct AnswerverifiedShow Answer

Correct Answer
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$36,150. Tom's standard deduction is $12...
View Answer

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b. If the household does not include a d...
View Answer

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As an ex-spouse does not meet the relati...
View Answer

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Correct Answer
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Correct Answer
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a. $800. Warren's standard deduction is ...
View Answer

Correct Answer
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The amount of income earned by the quali...
View Answer

Correct Answer
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Two. Only Pedro's parents are ...
View Answer

Correct Answer
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Correct Answer
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