Exam 1: The Individual Income Tax Return

Eugene and Velma are married. For 2019, Eugene earned $25,000 and Velma earned $30,000. They have decided to file separate returns. They have no deductions for adjusted gross income. Eugene's itemized deductions are $14,200 and Velma's are $4,000. Assuming Eugene and Velma do not live in a community property state and Eugene deducts the greater of the standard deduction or itemized deductions, what is Eugene's taxable income?

List each alternative filing status available to unmarried individual taxpayers.

Bob owns a rental property that he bought several years ago for $250,000. He has taken depreciation on the house of $35,000 since buying it. He sells it in 2019 for $290,000. His selling expenses are $12,000 for the year. What is Bob's realized gain on the sale?

Match the letter of the filing status to the taxpayers below. Items may be used more than once. -The taxpayer who is unmarried legally adopted a child who lives with her.

A taxpayer who maintains a household with an unmarried child may qualify to file as head of household even if the child is not the taxpayer's dependent.

For taxpayers who do not itemize deductions, the standard deduction amount is subtracted from the taxpayer's adjusted gross income.

Albert and Louise, ages 66 and 64, respectively, filed a joint return for 2019. They provided all of the support for their blind 19-year-old son, who had no gross income. They also provided the total support of Louise's father, who is a citizen and life-long resident of Peru. What is the amount of the credit for other dependents that Albert and Louise can claim?

Robert is a single taxpayer who has AGI of $145,000 in 2019; his taxable income is $122,000. What is his federal tax liability for 2019?

During the current tax year, Anita was entirely supported by her three sons, Dudley, Carlton, and Isidore, who provided support for her in the following percentages: Dudley 8 percent Carlton 45 percent Isidore 47 percent ? Which of the children may be allowed to claim his mother as a dependent, assuming a multiple support agreement exists?

Steven, age 35 and single, is a commodities broker. His salary for 2019 is $111,500 and he has taxable interest income of $40,000. He has no deductions for adjusted gross income. His itemized deductions are $31,000. Steven does not have any dependents. a. What is the amount of his adjusted gross income? b. What are his allowable itemized deductions? c. What is his deduction for personal exemptions? d. What is his taxable income? e. What is his regular tax liability from the tax rate schedules?

A corporation is a reporting entity but not a tax-paying entity.

During 2019, Howard maintained his home in which he and his 16-year-old son resided. The son qualifies as his dependent. Howard's wife died in 2018. What is his filing status for 2019?

Partnership capital gains and losses are allocated separately to each of the partners.

The maximum official individual income tax rate for 2019 is 39.6 percent, not including the Medicare surtax on net investment income.