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Exam 4: Individual Income Tax Overview, Dependents, and Filing Status

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Question 41

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If no one qualifies as the dependent of an unmarried taxpayer, the unmarried taxpayer may still be able to qualify for the head of household filing status.

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Question 42

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Which of the following statements regardingdependents is true?

A) To qualify as a dependent of another, an individual must be a resident of the United States.
B) To qualify as a dependent of another, an individual may not file a joint return with the individual's spouse under any circumstance.
C) To qualify as a dependent of another, an individual must have a family relationship with the other person.
D) To qualify as a dependent of another, an individual must be either a qualifying child or a qualifying relative of the other person.

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Question 43

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Sheri and Jake Woodhouse have one daughter, Emma, who is 16 years old. They also have taken in Emma's friend, Harriet, who has lived with them since February of the current year and is also 16 years of age. The Woodhouses have not legally adopted Harriet but Emma often refers to Harriet as her "sister." The Woodhouses provide all of the support for both girls, and both girls live at the Woodhouse residence. Which of the following statements is true regarding whom Sheri and Jake may claim as dependents for the current year?

Doug and Lisa have determined that their tax liability on their joint return is $3,700. They have made prepayments of $1,000 and also are entitled to a $2,000 child tax credit and $2,900 of recovery rebate credit. Assume they did not receive the recovery rebate in advance. What is the amount of their tax refund or taxes due?

The test for qualifying child includes an age restriction but the test for qualifying relative does not.

A taxpayer is not permitted to use the head of household filing status if she does not have any dependent children.

An individual receiving $6,000 of tax-exempt income during the year could qualify as a qualifying child of another taxpayer but could not qualify as a qualifying relative of another taxpayer.

A taxpayer who is claimed as a dependent on another's tax return may not claim any dependents on his or her tax return.

Sally received $60,000 of compensation from her employer and she received $500 of interest from a corporate bond. What is the amount of Sally's gross income from these items?

John Maylor is a self-employed plumber of John's John Service, his sole proprietorship. In the current year, John's John Service had revenue of $120,000 and $40,000 of business expenses. John also received $2,000 of interest income from corporate bonds. What is John's adjusted gross income, assuming he had no other income or expenses? (ignore any deduction for self-employment tax.)

Kelsey and Austin file a joint return. Kelsey works and receives income during the year but Austin does not. If the couple files a joint tax return, Austin is responsible for paying any taxes due if Kelsey is unable to pay the taxes.

Katy has one child, Dustin, who is 18 years old at the end of the year. Dustin lived at home for three months during the year before leaving home to work full time in another city. During the year, Dustin earned $15,000. Katy provided more than half of Dustin's support for the year. Which of the following statements regarding whether Katy may claim Dustin as a dependent for the current year is accurate?

Lebron received $56,400 of compensation from his employer and he received $645 of interest from a municipal bond. What is the amount of Lebron's gross income from these items?

The Tanakas filed jointly in 2020. Their AGI is $120,000. They reported $10,000 of qualified business income and $26,000 of itemized deductions. They also have two dependent qualifying children. The 2020 standard deduction amount for MFJ taxpayers is $24,800. What is the total amount of from AGI deductions they are allowed to claim on their 2020 tax return?

Which of the following statements regarding the difference between the requirements for a qualifying child and the requirements for a qualifying relative is false?

All of the following are tests for determining qualifying relative status except _____.

In order to be a qualifying relative of another, an individual's gross income must be less than _______.

In Year 1, Harold Weston's wife died. Since her death, he has maintained a household for their son, Frank (age 3) , his qualifying child. Which is the most advantageous filing status available to Harold in Year 4?

In certain circumstances, a taxpayer who provides less than half the support of another may still be able to claim that person as a dependent as a qualifying relative.

Which of the following statements about a qualifying person for head of household filing status is true?