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

Taxpayers are generally allowed to claim deductions for expenditures unless a specifictax provision indicates the expenditure is not deductible.

It is generally more advantageous from a tax perspective for a married couple to file separately than it is for them to file jointly.

Jane and Ed Rochester are married with a two-year-old child who lives with them and whom they support financially. In 2017, Ed and Jane realized the following items of income and expense: They also qualified for a $1,000 tax credit. Their employers withheld $1,800 in taxes from their paychecks (in the aggregate). Finally, the 2017 standard deduction amount for MFJ taxpayers is $12,700 and the 2017exemption amount is $4,050.What is the couple's gross income?

If an unmarried taxpayer provides more than half the support for a cousin who lives in the taxpayer's home for the entire year, the taxpayer will qualify for head of household filing status.

Jeremy and Annie are married. During the year Jeremy dies. When Annie files her tax return for the year in which her husband dies, she may file under the married filing jointly filing status even if she does not remarry.

The relationship requirement for qualifying relative includes cousins.

The relationship requirement is more broadly defined (includes more relationships) for a qualifying relative than it is for a qualifying child.

Madison's gross tax liability is $9,000. Madison had $3,000 of tax credits available and she had $8,000 of taxes withheld by her employer. What is Madison's taxes due (or taxes refunded) with her tax return?

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

Which of the following types of income are not considered ordinary income?

For purposes of the dependency exemption qualification, the test for qualifying children includes an age restriction but the test for qualifying relative does not.

All of the following are tests for determining qualifying child status except the________.

A taxpayer may qualify for the head of household filing status even if she does not have any dependent children.

Itemized deductions and the standard deduction are deductions from AGI but deductionsfor personal and dependency exemptions are deductions for AGI.

Jane and Ed Rochester are married with a two-year-old child who lives with them and whom they support financially. In 2017, Ed and Jane realized the following items of income and expense: They also qualified for a $1,000 tax credit. Their employers withheld $1,800 in taxes from their paychecks (in the aggregate). Finally, the 2017 standard deduction amount for MFJ taxpayers is $12,700 and the 2017exemption amount is $4,050.What is the couple's taxable income?

All of the following are for AGI deductions except:

To be considered a qualifying child of a taxpayer, the individual must be the son or daughter of the taxpayer.

Tax credits reduce taxable income dollar for dollar.

Which of the following statements regarding realized income is true?

Taxpayers who file as qualifying widows/widowers are treated exactly the same for tax purposes in all respects as taxpayers who are married filing jointly for tax purposes.