In: Accounting
BASED ON THE IRS WEBSITE ANSWER THE FOLLOWING QUESTION:
1A.What is the standard deduction for Head of Household for someone under 65 years of age? For someone over 65 years of age?
B. Explain 2 items reported as Additional Income on the 1040 Schedule 1.
C.Explain 2 Adjustments to Income reported on the 1040 Schedule 1.
D. Explain the types of items that are reported on the Form 1040 Schedule 2.
A.
For 2020 taxes filed in April 2021 the standard deductions are as follows:
The new standard deduction amounts, introduced by the Tax Cuts and Jobs Act at the end of 2017 and nearly double the previous amounts, are set to expire Dec. 31, 2025.
The federal income tax system and some states have higher standard deductions for people who are at least 65 years old and for people who are blind. Under federal guidelines, if you are 65 or older and single or a head of household, your standard deduction goes up $1,650 for 2019. If you are married filing jointly and one of you is 65 or older, your standard deduction goes up $1,300. If both of you are 65 or older, the deduction increases by $2600.
B.
Additional Income:
C.
Educator expenses are reported in the adjustments section of
Form 1040, Schedule 1. Don’t forget to
reduce the total educator expenses by any reimbursements,
nontaxable savings bond interest, nontaxable distribution from a
QTP, or nontaxable distribution of earnings from an ESA.
Alimony does not include child support or voluntary payments outside the instrument. The person paying alimony can subtract it as an adjustment to income; the person receiving alimony must treat it as income. A summary of the alimony requirements can be found in Tab E, Adjustments, in the Volunteer Resource Guide.
D.
1. You received an early distribution
from (a) an IRA or other qualified retire-
ment plan, (b) an annuity, or (c) a modi-
fied endowment contract entered into af-
ter June 20, 1988, and the total distribu-
tion wasn't rolled over.
2. Excess contributions were made
to your IRA, Coverdell education sav-
ings account (ESA), Archer MSA,
health savings account (HSA), or ABLE
account.
3. You received a taxable distribu-
tion from a Coverdell ESA, qualified
tuition program, or ABLE account.
4. You were born before July 1,
1948, and didn't take the minimum re-
quired distribution from your IRA or
other qualified retirement plan.