Question 1

A parent may elect to include a child's income in the parent's return if:

Accepted Answer

A) No estimated tax has been paid in the name of the child and the child is not subject to backup withholding. 
B) The child's income is only from interest and dividend distributions. 
C) The child's gross income is more than $1,050 and less than $10,500. 
D) All of the above must be met for a parent to elect to include a child's income in the parent's return. 
A) No estimated tax has been paid in the name of the child and the child is not subject to backup withholding. 
B) The child's income is only from interest and dividend distributions. 
C) The child's gross income is more than $1,050 and less than $10,500. 
D) All of the above must be met for a parent to elect to include a child's income in the parent's return.

Question 2

Molly and Steve are married and live in Texas. Molly earns a salary of $50,000 and Steve owns a rental property that gives him $35,000 of income. If they filed separate tax returns, what amount of income would Steve report?

Accepted Answer

A) $35,000 
B) $85,000 
C) $42,500 
D) $60,000 
E) None of the above 
A) $35,000 
B) $85,000 
C) $42,500 
D) $60,000 
E) None of the above

Question 3

For 2016, the maximum amount of expenses that qualify for the child and dependent care credit is the same for three dependents as it is for two dependents.

Accepted Answer

A) True 
 B)False

Question 4

List at least two AMT preferences and/or adjustments and show the simplified formula for calculating AMT. Do not include dollar exemption amounts or the tax rate schedule.

Accepted Answer

(1) Adjustments and preferences would in

Question 5

In determining the amount of the child and dependent care credit, there is a limit of $2,000 on the amount of qualified expenses for one dependent.

Accepted Answer

A) True 
 B)False

Question 6

Arthur is divorced with two dependent children, ages 8 and 13. His adjusted gross income is $28,000, and he incurs qualified child care expenses of $6,000, $3,000 for each child.
a.What is the amount of Arthur's qualified child care expenses after any limitation?
b.Calculate the amount of Arthur's child and dependent care credit.

Accepted Answer

The answer of Arthur is divorced with two dependent children,...

Question 7

What is the purpose of the alternative minimum tax?

Accepted Answer

The purpose is to ensure that

Question 8

Which of the following types of income is not subject to the "kiddie tax?"

Accepted Answer

A) Interest income 
B) Dividend income 
C) Salary income 
D) Capital gains on stock sales 
E) All of the above are subject to the "kiddie tax" 
A) Interest income 
B) Dividend income 
C) Salary income 
D) Capital gains on stock sales 
E) All of the above are subject to the "kiddie tax"

Question 9

The foreign tax credit applies only to foreign corporations.

Accepted Answer

A) True 
 B)False

Question 10

Daddy Warbucks is in the process of adopting Annie from a New York orphanage. He pays $5,000 in 2014, $7,000 in 2015, and $4,500 in 2016. Daddy Warbucks' AGI for 2016 is $165,000.
​
a.How much is the adoption credit that Daddy Warbucks may claim for 2016 if the adoption becomes final in 2016?
b.How much is the adoption credit that Daddy Warbucks may claim for 2016 if the adoption becomes final in 2017?
c.How much is the adoption credit that Daddy Warbucks may claim for 2016 if the adoption falls through and is never finalized?

Accepted Answer

a. $8,460. $11,500 ($7,000 + $

Question 11

Robert and Mary file a joint tax return for 2016 with adjusted gross income of $34,000. Robert and Mary earned income of $20,000 and $14,000, respectively, during 2016. In order for Mary to be gainfully employed, they pay the following child care expenses for their 4-year-old son, John: What is the amount of the child and dependent care credit they should report on their tax return for 2016?

Accepted Answer

A) $270 
B) $459 
C) $675 
D) $729 
E) None of the above 
A) $270 
B) $459 
C) $675 
D) $729 
E) None of the above

Question 12

​Household income for purpose of the premium tax credit includes all of the following except:

Accepted Answer

A) ​AGI of the taxpayer 
B) ​AGI of the taxpayer's dependents 
C) ​Any tax-exempt income 
D) ​Nontaxable Social Security benefits 
E) ​All of the above are included in household income 
A) ​AGI of the taxpayer 
B) ​AGI of the taxpayer's dependents 
C) ​Any tax-exempt income 
D) ​Nontaxable Social Security benefits 
E) ​All of the above are included in household income

Question 13

For 2016, Beatrice qualifies for the earned income credit. She has one daughter who is 7 years old. Her earned income and adjusted gross income for 2016 are $6,200.
a.Using the EIC tables, calculate the amount of her 2016 earned income credit.
b.​
Calculate the amount of Beatrice's 2016 earned income credit assuming her earned income for 2016 is $8,500 and her adjusted gross income is $10,000.

Accepted Answer

The answer of For 2016, Beatrice qualifies for the earned...

Question 14

In calculating the individual AMT, the tentative minimum tax liability may not exceed the regular tax liability of the taxpayer.

Accepted Answer

A) True 
 B)False

Question 15

A tax credit is allowed for qualified adoption expenses paid by taxpayers:

Accepted Answer

A) And an additional credit is allowed for qualified adoption expenses paid for by taxpayers' employers. 
B) And an income exclusion is allowed for qualified adoption expenses paid for by taxpayers' employers. 
C) And is available each year qualifying expenses are incurred. 
D) And is not subject to a phase-out based on adjusted gross income. 
A) And an additional credit is allowed for qualified adoption expenses paid for by taxpayers' employers. 
B) And an income exclusion is allowed for qualified adoption expenses paid for by taxpayers' employers. 
C) And is available each year qualifying expenses are incurred. 
D) And is not subject to a phase-out based on adjusted gross income.

Question 16

Bob and Carol file their tax returns using the married filing jointly status. Their AGI is $132,500. They have two children, ages 11 and 7. How much child tax credit can Bob and Carol claim for their two children?

Accepted Answer

A) $0 
B) $850 
C) $875 
D) $1,150 
E) None of the above is correct. 
A) $0 
B) $850 
C) $875 
D) $1,150 
E) None of the above is correct.

Question 17

Jeff is a stay-at-home father who earns $600 from odd jobs and takes care of his daughter. His wife, Michelle, is the bread-winner and brings in $60,000 of income a year. In addition to the care provided by Jeff, Michelle pays $4,500 in child care.
​
In the current year, how much are Jeff and Michelle's qualifying expenses for the child and dependent care credit?

Accepted Answer

$600. The qualifying expenses

Question 18

Martin and Rachel are married and have a 3-year-old child. Martin is going to medical school full-time for 12 months of the year and Rachel earns $45,000. Their child is in day care so Martin can go to school while Rachel is at work. The cost of their day care is $10,000. What is their child and dependent care credit? Please show your calculations and explain.

Accepted Answer

$600. Martin is credited with $250 a mon

Question 19

Calculate the child tax credits for the following taxpayers. Please show your work.
a.Ninfa is a single mother with 8-year-old and 9-year-old dependent sons and has $50,000 of AGI.
b.Sharon and Mark have one dependent 2-year-old child and $126,300 of AGI.
c.Carol is single and has one dependent 18-year-old son and $21,000 of AGI.

Accepted Answer

a. $2,000. Ninfa's income is less than t

Question 20

Which one of the following taxpayers qualify for the earned income credit?

Accepted Answer

A) A 70-year-old doctor whose practice had a net loss and who has an AGI of $5,000 in 2016. 
B) An 18-year-old college student who earns $8,000 at a part-time job. 
C) A couple who have a combined AGI of $17,000 and three children but file separately. 
D) A single, 31-year-old construction worker with $22,000 of AGI and two children. 
E) None of the above qualifies for the earned income credit. 
A) A 70-year-old doctor whose practice had a net loss and who has an AGI of $5,000 in 2016. 
B) An 18-year-old college student who earns $8,000 at a part-time job. 
C) A couple who have a combined AGI of $17,000 and three children but file separately. 
D) A single, 31-year-old construction worker with $22,000 of AGI and two children. 
E) None of the above qualifies for the earned income credit.

A parent may elect to include a child's income in the parent's return if:

Molly and Steve are married and live in Texas. Molly earns a salary of $50,000 and Steve owns a rental property that gives him $35,000 of income. If they filed separate tax returns, what amount of income would Steve report?

For 2016, the maximum amount of expenses that qualify for the child and dependent care credit is the same for three dependents as it is for two dependents.

List at least two AMT preferences and/or adjustments and show the simplified formula for calculating AMT. Do not include dollar exemption amounts or the tax rate schedule.

In determining the amount of the child and dependent care credit, there is a limit of $2,000 on the amount of qualified expenses for one dependent.

What is the purpose of the alternative minimum tax?

Which of the following types of income is not subject to the "kiddie tax?"

The foreign tax credit applies only to foreign corporations.

Household income for purpose of the premium tax credit includes all of the following except:

In calculating the individual AMT, the tentative minimum tax liability may not exceed the regular tax liability of the taxpayer.

A tax credit is allowed for qualified adoption expenses paid by taxpayers:

Bob and Carol file their tax returns using the married filing jointly status. Their AGI is $132,500. They have two children, ages 11 and 7. How much child tax credit can Bob and Carol claim for their two children?

Which one of the following taxpayers qualify for the earned income credit?

The Individual Income Tax Return

Gross Income and Exclusions

Business Income and Expenses Part I

Business Income and Expenses Part II

Itemized Deductions and Other Incentives

Accounting Periods and Methods and Depreciation

Capital Gains and Losses

Withholding Estimated Payments and Payroll Taxes

Partnership Taxation

The Corporate Income Tax

Tax Administration and Tax Planning

Filters

Exam 6: Credits and Special Taxes

A parent may elect to include a child's income in the parent's return if:

Molly and Steve are married and live in Texas. Molly earns a salary of $50,000 and Steve owns a rental property that gives him $35,000 of income. If they filed separate tax returns, what amount of income would Steve report?

For 2016, the maximum amount of expenses that qualify for the child and dependent care credit is the same for three dependents as it is for two dependents.

List at least two AMT preferences and/or adjustments and show the simplified formula for calculating AMT. Do not include dollar exemption amounts or the tax rate schedule.

In determining the amount of the child and dependent care credit, there is a limit of $2,000 on the amount of qualified expenses for one dependent.

What is the purpose of the alternative minimum tax?

Which of the following types of income is not subject to the "kiddie tax?"

The foreign tax credit applies only to foreign corporations.

​Household income for purpose of the premium tax credit includes all of the following except:

In calculating the individual AMT, the tentative minimum tax liability may not exceed the regular tax liability of the taxpayer.

A tax credit is allowed for qualified adoption expenses paid by taxpayers:

Bob and Carol file their tax returns using the married filing jointly status. Their AGI is $132,500. They have two children, ages 11 and 7. How much child tax credit can Bob and Carol claim for their two children?

Which one of the following taxpayers qualify for the earned income credit?

The Individual Income Tax Return

Gross Income and Exclusions

Business Income and Expenses Part I

Business Income and Expenses Part II

Itemized Deductions and Other Incentives

Accounting Periods and Methods and Depreciation

Capital Gains and Losses

Withholding Estimated Payments and Payroll Taxes

Partnership Taxation

The Corporate Income Tax

Tax Administration and Tax Planning

Filters

Household income for purpose of the premium tax credit includes all of the following except: