Question

Your clients, Adam and Amy Accrual, have a 21-year-old daughter named April. April is single and is a full-time student studying for her bachelor’s degree in accounting at California Poly Academy (CPA) in Pismo Beach, California, where she lives with her roommates year-round. Last year, April worked at a local bar and restaurant four nights a week and made $18,000, which she used for tuition, fees, books, and living expenses. Her parents help April by sending her $300 each month to help with her expenses at college. This is all of the support given to April by her parents. When preparing Adam and Amy’s tax return, you note that they claim April as a dependent for tax purposes. Adam is insistent that they can claim April because of the $300 per month support and the fact that they “have claimed her since she was born.” He will not let you take April off his return as a dependent. Would you sign the Paid Preparer’s declaration (see example above) on this return? Why or why not?

Answer 1

Answer:

To guarantee a child as a dependent, the child must be either underneath age of 19 or if a student then below 24 years.

In the event that the citizen or his mate is considered as a subject to some other's government form, at that point the standard reasoning that can be permitted on the citizen's arrival is for the most part restricted to the greater of:

1. $1,050 or

2. The person's earned wage for the year in addition to $350(subject to standard conclusion measure of $6,350, when all is said in done)

Here while setting up the expense forms of Adam and Amy, they have included April as a ward.

Therefore,April can be taken as a ward in the expense form since April is as yet living on the help of her folks. Be that as it may, Adam can get standard finding as restricted according to the law in the arrival, uncovering April's income.

The standard reasoning accessible is higher of

1.$1,050 or

2.$18,000+$350 however subject to $6,350

Along these lines Adam can get a finding of $6,350.