Exam 2: Determination of Tax

Indicate for each of the following the most favorable filing status for the 2017 tax year. a.Kenny died on March 2,2016.Marge,his wife,and Bart,their son,survive.Marge filed a joint return in 2016.Bart,age 18 in 2017,is a part-time college student and continues to live at home with his mother.He works part-time,earning $6,200.What is Marge's filing status in 2017? b.Alan Spaulding is single and provides over 50% support of his niece Alicia who lives with him all year long.Alan maintains the household and claims Alicia as a dependent.Alicia makes $3,600 at a part-time job.She is a full-time student,age 18.What is Alan's filing status? c.Lily,who was divorced on July 27,2017,provides 100% of the support for her parents who live in a nursing home in Kansas and have no income.What is Lily's filing status? d.Holly was abandoned by her husband Fletcher in September of the current year.She has not seen or communicated with him since then.What is Holly's filing status? e.Rick,whose wife died in December 2014,filed a joint tax return for 2014.He did not remarry,but has continued to maintain his home in which his two dependent children live.What is Rick's filing status for 2017?

Assuming a calendar tax year and the conventional 15th of the month due date,all of the following business entities must file their 2017 tax returns by the March 15,2018 except

Annisa,who is 28 and single,has adjusted gross income of $55,000 and itemized deductions of $5,000.In 2017,Annisa will have taxable income of

For purposes of the dependency exemption,a qualifying child may not provide more than one-half of his or her own support during the year.

Parents must provide more than half the support of their child under the age of 19 in order to claim her as a dependent qualifying child.

A single taxpayer provided the following information for 2017: What is taxable income?

Married couples will normally file jointly.Identify a situation where a married couple may prefer to file separately.

Dave,age 59 and divorced,is the sole support of his mother age 83,who is a resident of a local nursing home for the entire year.Dave's mother had no income for the year.Dave's filing status and exemptions claimed are

The child credit is for taxpayers with dependent children under the age of

For 2017,unearned income in excess of $2,100 of a child under age 18 is generally taxed at the parents' rate.

A married couple in the top tax bracket has a new baby.Due to the birth of the baby their taxable income will be reduced in 2017 by $4,050.

All of the following items are deductions for adjusted gross income except

Generally,when a married couple files a joint return,each spouse is liable for one-half of the entire tax and any penalties incurred.

The following information is available for Bob and Brenda Horton,a married couple filing a joint return,for 2017.Both Bob and Brenda are age 32 and have no dependents. a.What is the amount of their gross income? b.What is the amount of their adjusted gross income? c.What is the amount of their taxable income? d.What is the amount of their tax liability (gross tax),rounded to the nearest dollar? e.What is the amount of their tax due or (refund due)?

Tax returns from individual taxpayers and partnerships are due on the 15th day of the fourth month following the close of the tax year.

The amount of Social Security tax paid by the taxpayer will be a consideration in determining the refundable component of the child credit for larger families.

A married taxpayer may file as head of household under the abandoned spouse provisions if all of the following are met except

Maxine,who is 76 years old and single,is appropriately claimed as a dependent on her daughter Beth's tax return.During 2017 she received $500 interest on a savings account.She had a part time job that earned $3,000.Her total itemized deductions were $1,300. Required: Compute Maxine's taxable income for 2017.Show all calculations.

Generally,in the case of a divorced couple,the parent who has physical custody of a child for the greater part of the year is entitled to the dependency exemption.

Although exclusions are usually not reported on an individual's income tax return,interest income on state and local government bonds must be reported on the tax return.