Exam 14: Special Tax Computation Methods, tax Credits, and Payment of Tax

Dwayne has general business credits totaling $30,000 before limitation.His regular tax liability is $83,000 and his tentative minimum tax is $79,000.What amount of general business credit can Dwayne take this year?

Lavonne has a regular tax liability of $13,239 on taxable income of $70,000.She also has tax preferences of $25,000 and positive adjustments attributable to limitations on itemized deductions of $15,000.Lavonne is single and takes a $4,050 personal exemption for herself only.Lavonne's alternative minimum tax for 2017 is

Which of the following statements is not correct regarding the residential energy efficient property (REEP) credit?

The health insurance premium assistance credit is designed to help lower and middle income taxpayers who purchase their own health insurance directly from an insurance company or through a state or federal exchange.

The earned income credit is refundable only if a tax has been withheld.

Max and Alexandra are married and incur $5,500 of qualifying expenses to care for their two children,ages 2 and 5.Max's earned income is $35,000 and Alexandra's earnings from a part-time job are $5,000.What is the amount of the qualifying expenses for purposes of computing the child and dependent care credit?

Layla earned $20,000 of general business credits from her sole proprietorship.Her regular tax liability is $45,000,and her tentative minimum tax is $49,000.During the current year Layla will apply general business credits of

In 2017,Charlton and Cindy have alternative minimum taxable income of $130,000 and file a joint return.For purposes of computing the alternative minimum tax,their exemption is

Discuss actions a taxpayer can take if it is anticipated that his income taxes will be substantially underpaid in order to minimize penalties.

Discuss tax-planning options available for expenses incurred for child and dependent care.

The qualified retirement savings contributions credit is based on a maximum contribution of $2,000.

Individuals who do not have minimum essential health insurance coverage will pay an excise tax.

The itemized deduction phase-out,which has the effect of increasing regular taxable income for high income taxpayers,will also raise AMTI.

All of the following are self-employment income except

John has $55,000 of self-employment earnings from a sole proprietorship.John is also employed part-time by a major corporation and is paid $25,000.John's self-employment tax for 2017 is

Taxpayers with income below phase-out amounts are allowed a child credit of $1,000 for each qualifying child under age 19 or under age 24 if a full-time student.

Mark and Stacy are married,file a joint return,and have one child,age 3.Their combined AGI is $55,000.Mark and Stacy incur $3,500 of child care expenses during the current year.Mark's employer reimburses him $1,500 under a qualified dependent care assistance plan.The child and dependent care credit is

A taxpayer who paid AMT in prior years,but is not subject to the AMT in the current year,may be entitled to an AMT credit against his regular tax liability in the current year.

A taxpayer's tentative minimum tax exceeds his net income tax so he will be paying the alternative minimum tax this year.The taxpayer has a sole proprietorship through which he has earned general business credits.The taxpayer can reduce his AMT to the extent of his general business credits.

Joe,who is single with modified AGI of $84,000,is sending his son to his first year of college.The total tuition and related payments during the year amounted to $18,000.Joe has not taken advantage of any other type of tax benefit related to educational expenses.His American Opportunity Tax Credit is