Question 1

In June of Year 1,Jake's wife,Darla,died.The couple did not have any children and Jake did not remarry in Year 1 or Year 2.Which is the most favorable filing status for Jake in Year 2?

Accepted Answer

A)  Married filing separately.
B)  Single.
C)  Head of household.
D)  Qualifying widower.E) A) and C)
F) B) and C)

Question 2

A personal automobile is a capital asset.

Accepted Answer

A) True 
 B)False  True

Question 3

Charles,who is single,pays all of the costs of maintaining a home for himself and Damarcus.Charles and Damarcus have no family relationship but Damarcus lives with Charles for the entire year.Damarcus qualifies as a qualifying relative of Charles.(Charles claims Damarcus as a dependent on his tax return.)Charles qualifies for head of household filing status.

Accepted Answer

A) True 
 B)False

Question 4

Earl and Lawanda Jackson have been married for 15 years.They have no children.Ned,who is an old friend from high school,has been living with the Jacksons during the current year.Which of the following is a true statement regarding whether the Jacksons can claim Ned as a dependent for the current year?

Accepted Answer

A)  If Ned moved into the Jackson's home in June and he lived there for the remainder of the year,he may qualify as the Jackson's qualifying relative.
B)  Assume that Ned originally moved into the Jackson's home two years ago and he has lived there ever since.If this year Ned earned $3,000 at a part-time job and he received $5,000 in municipal bond interest,he may qualify as the Jackson's dependent so long as the Jacksons provided more than half his support.
C)  If Ned lived in the Jackson's home for the entire year,he will qualify as their dependent no matter who provided his support.
D)  If Ned is over 19 or he is not a full-time student,he cannot qualify as the Jackson's dependent.E) A) and C)
F) C) and D)

Question 5

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.What is the amount of their tax refund or taxes due?

Accepted Answer

$700 taxes due ($3,7...

Question 6

If an unmarried taxpayer is eligible to claim another as a dependent,the taxpayer is automatically eligible for the head of household filing status.

Accepted Answer

A) True 
 B)False  False

Question 7

For purposes of the qualifying child residence test,a child's temporary absence from the taxpayer's home to attend school full time is counted as though the child lived in the taxpayer's home during the absence.

Accepted Answer

A) True 
 B)False

Question 8

In April of Year 1,Martin left his wife,Marianne.The couple has two children under the age of 15.While the couple was apart,they were not legally divorced.Marianne remained in the home and paid all the costs of maintaining the home for the remainder of the year.Assuming the couple does not file jointly,which of the following statements regarding filing status is true?

Accepted Answer

A)  No matter the post-separation residence(s) of the children,both spouses must file as married filing separately.
B)  No matter the post-separation residence(s) of the children,Martin must file as married filing separately but Marianne may qualify to file as head of household.
C)  No matter the post-separation residence(s) of the children,Marianne must file as married filing separately but Martin may qualify to file as head of household.
D)  Depending on the post-separation residence(s) of the children,both spouses may qualify to file as head of household.E) A) and B)
F) None of the above

Question 9

Which of the following statements regarding realized income is true?

Accepted Answer

A)  Taxpayers need not include realized income in gross income unless a specific provision of the tax code requires them to do so.
B)  Realized income requires some type of transaction or exchange with a second party.
C)  Once income is realized it cannot be excluded from gross income.
D)  None of these statements are true.E) B) and D)
F) None of the above

Question 10

In April of Year 1,Martin left his wife,Marianne.While the couple was apart,they were not legally divorced.Marianne found herself having to financially provide for the couple's only child (who qualifies as Marianne's dependent) and to pay all the costs of maintaining the household.When Marianne filed her tax return for Year 1,she filed a return separate from Martin.What is Marianne's most favorable filing status for Year 1?

Accepted Answer

A)  Married filing separately.
B)  Single.
C)  Head of household.
D)  Qualifying widow.E) B) and D)
F) A) and B)

Question 11

Taxpayers need not include an income item in gross income unless there is a specific tax provision requiring the taxpayer to include the income item in gross income.

Accepted Answer

A) True 
 B)False

Question 12

Certain types of income are taxed at a lower rate than ordinary income.

Accepted Answer

A) True 
 B)False  True

Question 13

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

Accepted Answer

A)  One individual (who is a qualifying person) may qualify more than one taxpayer for head of household filing status.
B)  The taxpayer is required to live with a qualifying person for the entire year in order to qualify for head of household filing status.
C)  A taxpayer's parent cannot be a qualifying person for purposes of determining head of household filing status.
D)  A qualifying person must have a family relationship with the taxpayer in order for the qualifying person to qualify the taxpayer for head of household filing status.E) A) and D)
F) B) and C)

Question 14

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

Accepted Answer

A)  the applicable standard deduction amount
B)  a fixed amount specified for the particular tax year
C)  one-half of the individual's support
D)  None of the choices are correct.E) A) and C)
F) None of the above

Question 15

Qualified dividends are taxed at the same rate as ordinary income.

Accepted Answer

A) True 
 B)False

Question 16

From AGI deductions are commonly referred to as deductions "below the line."

Accepted Answer

A) True 
 B)False

Question 17

Filing status determines all of the following except ________.

Accepted Answer

A)  the applicable standard deduction amount
B)  the appropriate tax rate schedule or tax table
C)  the top-stated marginal rate in the tax rate schedule
D)  the AGI threshold for reductions in certain tax benefitsE) A) and D)
F) All of the above

Question 18

Which of the following series of inequalities is generally most accurate?

Accepted Answer

A)  Gross income ≥ adjusted gross income ≥ taxable income
B)  Adjusted gross income ≥ gross income ≥ taxable income
C)  Adjusted gross income ≥ taxable income ≥ gross income
D)  Gross income ≥ taxable income ≥ adjusted gross incomeE) All of the above
F) None of the above

Question 19

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

Accepted Answer

A) True 
 B)False

Question 20

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

Accepted Answer

A)  The relationship requirement is more broadly defined (more inclusive) for qualifying relatives than for qualifying children.
B)  Qualifying children are subject to age restrictions while qualifying relatives are not.
C)  The support test for qualifying relatives focuses on the support the potential dependent self-provides while the support test for qualifying children focuses on the support the taxpayer provides.
D)  Qualifying relatives are subject to a gross income restriction while qualifying children are not.E) B) and D)
F) A) and B)

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

In June of Year 1,Jake's wife,Darla,died.The couple did not have any children and Jake did not remarry in Year 1 or Year 2.Which is the most favorable filing status for Jake in Year 2?

Correct Answer
verified

A personal automobile is a capital asset.

Correct Answer
verified
True

Correct Answer
verified

Correct Answer
verified

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.What is the amount of their tax refund or taxes due?

Correct Answer
verified
$700 taxes due ($3,7...
View Answer

If an unmarried taxpayer is eligible to claim another as a dependent,the taxpayer is automatically eligible for the head of household filing status.

Correct Answer
verified
False

For purposes of the qualifying child residence test,a child's temporary absence from the taxpayer's home to attend school full time is counted as though the child lived in the taxpayer's home during the absence.

Correct Answer
verified

Correct Answer
verified

Which of the following statements regarding realized income is true?

Correct Answer
verified

Correct Answer
verified

Taxpayers need not include an income item in gross income unless there is a specific tax provision requiring the taxpayer to include the income item in gross income.

Correct Answer
verified

Certain types of income are taxed at a lower rate than ordinary income.

Correct Answer
verified
True

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

Correct Answer
verified

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

Correct Answer
verified

Qualified dividends are taxed at the same rate as ordinary income.

Correct Answer
verified

From AGI deductions are commonly referred to as deductions "below the line."

Correct Answer
verified

Filing status determines all of the following except ________.

Correct Answer
verified

Which of the following series of inequalities is generally most accurate?

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

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

In June of Year 1,Jake's wife,Darla,died.The couple did not have any children and Jake did not remarry in Year 1 or Year 2.Which is the most favorable filing status for Jake in Year 2?

Correct AnswerverifiedShow Answer

A personal automobile is a capital asset.

Correct AnswerverifiedTrue

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

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.What is the amount of their tax refund or taxes due?

Correct Answerverified$700 taxes due ($3,7...View AnswerShow Answer

If an unmarried taxpayer is eligible to claim another as a dependent,the taxpayer is automatically eligible for the head of household filing status.

Correct AnswerverifiedFalse

For purposes of the qualifying child residence test,a child's temporary absence from the taxpayer's home to attend school full time is counted as though the child lived in the taxpayer's home during the absence.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following statements regarding realized income is true?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Taxpayers need not include an income item in gross income unless there is a specific tax provision requiring the taxpayer to include the income item in gross income.

Correct AnswerverifiedShow Answer

Certain types of income are taxed at a lower rate than ordinary income.

Correct AnswerverifiedTrue

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Qualified dividends are taxed at the same rate as ordinary income.

Correct AnswerverifiedShow Answer

From AGI deductions are commonly referred to as deductions "below the line."

Correct AnswerverifiedShow Answer

Filing status determines all of the following except ________.

Correct AnswerverifiedShow Answer

Which of the following series of inequalities is generally most accurate?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified
True

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
$700 taxes due ($3,7...
View Answer

Correct Answer
verified
False

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
True

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified