In: Accounting
Interview Notes
1. Jeff may need to make a shared responsibility payment. True/False
2. Linda does not need to make a shared responsibility payment because she qualifies for an exemption under the short coverage gap criteria.True/False
Interview Notes
3. Ava cannot claim her son for the earned income credit because he did not live with her for more than half the year and does not meet the residency test.
A. True, David only lived with his mother during the summer, which was less than six months.
B. False, attendance at school is considered a temporary absence and this time is counted as time that her child lived with her.
Interview Notes
4. David is Ava’s qualifying person for which of the following? (Select all that apply)
A. Head of Household filing status
B. Credit for other dependents
C. Education credit
D. Child tax credit
Interview Notes
5. What is the amount of Ellen's standard deduction?
A. $24,000
B. $19,600
C. $18,000
D. $12,000
6. The maximum amount of additional child tax credit that Ellen is able to claim per qualifying child is:
A. $500
B. $1,000
C. $1,400
D. $2,000
Interview Notes
7. Can Christopher and Amanda claim Jennifer as a qualifying child for the earned income credit (EIC)?
A. Yes, because their income is below the threshold for claiming EIC.
B. Yes, because Jennifer is 3 years old and lives with her parents.
C. No, because Christopher and Amanda both have ITINs.
D. Both A and B.
8. Which credits can Christopher and Amanda claim on their tax return?
A. Child and dependent care credit
B. Child tax credit
C. Credit for other dependents
D. Both A and B
Interview Notes
9. Which of the following statements is true?
A. Both Ashley and Mathew's filing status is Single.
B. Ashley is eligible to claim Head of Household and Mathew must file Single.
C. Ashley's filing status is Married Filing Separately and Mathew's filing status is Single.
D. Ashley's filing status is Married Filing Separately and Mathew's filing status is Head of Household.
10. Who can claim Mark and Kevin as qualifying children for earned income credit?
A. Ashley
B. Mathew
C. Both Mathew and Ashley
Interview Notes
11. What actions should George and Helen take to prevent having a balance due next year?
A. They should use the withholding calculator.
B. They should adjust their Form W-4 to increase withholding.
C. There is no way to prevent a balance due.
D. Both A and B.
12. What options do George and Helen have if they are not able to full pay their balance due by the due date of the return?
A. Wait to file their return until they have the money to pay the full amount owed.
B. File Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return.
C. Pay as much as they can by the due date of the return and request a payment plan.
D. Both A and C.
13. George and Helen ask if their son Joshua should file a tax return for 2018. How should the volunteer respond?A. Joshua is exempt from filing because he is a student.
B. Joshua does not have to file because he is their dependent and they can claim his income on their tax return.
C. Joshua must file based on the 2018 filing threshold for children and other dependents.
D. Joshua should file a tax return to claim a refund of his withholding.
14. What is the amount of gambling winnings claimed on Jacob's and Martha's 2018 tax return?
A. $0
B. $1,300
C. $2,000
D. $2,500
15. Jacob and Martha can claim $2,000 of qualified education expenses to calculate Daniel's American opportunity credit.True/False
16. How much of Martha and Jacob's Social Security is taxable?
A. $0
B. $6,851
C. $7,169
D. $26,350
17. The amount of Martha and Jacob's standard deduction is $________.
18. Which of the following items are included in the total payments on Jacob and Martha's tax return?
A. Federal income tax withheld from Forms W-2 and 1099
B. $400 applied from 2017 return
C. Refundable credits
D. All of the above
19. What form must be used to split Jacob and Martha’s refund?
A. Form 8888, Allocation of Refund (Including Savings Bond Purchases)
B. Form 8880, Credit for Qualified Retirement Savings Contributions
C. Form 8862, Information To Claim Earned Income Credit After Disallowance
D. There is no form. A refund can't be split.
20. Does Emily have to pay a shared responsibility payment on her tax return?
A. Yes, she did not have full health coverage for 12 months of the year.
B. No, she can claim a short coverage gap exemption on her tax return.
21. The amount of Emily's education credit claimed on her tax return is $________.
22. Emily's total federal income tax withheld is $________.
23. What is the total credit amount shown on Form 2441, Child and Dependent Care Expenses?
A. $0
B. $600
C. $660
D. $792
24. Emily is eligible to claim the child tax credit on her 2018 tax return.True/False
25. Emily is subject to the 10% additional tax from her 401(k) distribution.True/False
Ans. 1. False
Jeff may not need to make a shared responsibility payment. Because for shared responsibility payment husband and wife should file joint return and health care coverage for each month of the year.
Ans. 2. False
For individual shared responsibility payment requirement is health care coverage for each month of year. But Linda does not get health insurance in month of October, so she cannot shared her responsibility payment even though she get exemption under the short coverage gap criteria(less than three months), and Linda's gap is only in October month.So, she is qualify for exemption under short coverage gap. But she is not covered under shared responsibility payment criteria.
Ans. 3. (A) True, David only lived with his mother during the summer, which was less than six months.
For age test qualify children should have age under 17.
Eligibility for child credit as dependent
1. child must be one's own child. David is own child of Ava. So,David is qualified for condition.
2. dependent test for child credit age is under 19 or under 24. David is of 20 years age, so he is qualify age criteria in case of dependent.
3. Full time student, spend at least five months at college/school in a year.David is a full-time student working towards a degree in Business Administration lives at campus during school days. So he is also eligible for that condition.
4. He lived with his parent (in case of divorce, single parent) more than 6 months. David lives with his mother Ava only during summer which is of less than 6 months. So, David does not qualify for this condition of dependent.
Ans. 4. -(B) Credit for other dependents
Children that are not under child credit under age 17, can get credit for other dependents.
For, Head of Household filing status credit someone should fulfill both requirements
(a) Child tax credit and
(b) dependent
For, Education credit, Parent(guardian) and child both should need to pay federal tax returns.But only Ava pays income tax, David is not paying.
Ans. 5. (A) $24,000
Standard deduction for Qualifying Widow or Widower is $24,000.