Question 1

Which of the following is not a qualifying child for purposes of calculating the EIC?

Accepted Answer

A)  Son or daughter. 
B)  Grandson or granddaughter. 
C)  Foster child. 
D) All of these qualify.

Question 2

Which of the following statements is false regarding the earned income credit (EIC)?

Accepted Answer

A)  Maximum amount of the credit depends on the earned income and number of children. 
B)  The credit is refundable. 
C)  If certain requirements are met, a taxpayer may receive advance payments of EIC. 
D) A taxpayer without children cannot claim the credit.

Question 3

Sandra is single and her son Julius is 12 years old. If her AGI is $79,000, what amount of child tax credit can Sandra claim?

Accepted Answer

A)  $0. 
B)  $500. 
C)  $800. 
D) $1,000.

Question 4

Which of the following statements is correct?

Accepted Answer

A)  Taxpayers with household income which is more than 400% of the Federal Poverty Level are eligible to claim the premium tax credit. 
B)  The premium tax credit is only available when the taxpayer files his or her tax return. 
C)  The premium tax credit is designed to help eligible taxpayers pay some of their health insurance premium. 
D) Taxpayers who receive a credit are not required to file a federal tax return.

Question 5

The adoption credit is only available for domestic adoptions.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following statements regarding adoption credits is not true?

Accepted Answer

A)  There is a dollar limit to the maximum credit allowed per adopted child. 
B)  Form 8839 must be filed to claim the credit. 
C)  Adoption of foreign country children does not qualify for the credit. 
D) Adoption of a child of taxpayer's spouse does not qualify.

Question 7

Tuan and Marisa are married, file a joint return, and have two dependent children, Zack, age 6 and Aaron, age 5. Tuan has earned income of $72,000. Marisa was a full- time student (for nine months) with no income. They paid a qualified day care center $5,000. How much is Tuan and Marisa's child and dependent care credit for the year?

Accepted Answer

A)  $600. 
B)  $900. 
C)  $1,000. 
D) $1,200.

Question 8

Jesus and Mindy have modified AGI of $210,000, adopted a girl from Miami, Florida, and incurred a total of $18,000 in qualified adoption expenses. What is the amount of adoption credit they can claim in the current year? (Do not round interim calculations)

Accepted Answer

A)  $3,012. 
B)  $10,388. 
C)  $13,400. 
D) $18,000.

Question 9

The earned income credit is available for taxpayers with children only.

Accepted Answer

A) True 
 B)False

Question 10

Taxpayers with household income between 100% and 400% of the Federal Poverty Level are generally eligible for a premium tax credit.

Accepted Answer

A) True 
 B)False

Question 11

If the modified AGI of a married filing joint taxpayer exceeds $130,000 in 2015, the lifetime learning credit phases out completely.

Accepted Answer

A) True 
 B)False

Question 12

Noah and Olivia have two boys, Jordan, age 6 and Jack, age 5. Their AGI is $176,000. What amount of child tax credit can they claim?

Accepted Answer

A)  $0. 
B)  $1,000. 
C)  $2,000. 
D) $2,300.

Question 13

The American opportunity tax credit phases out beginning at $80,000 of modified AGI for single taxpayers.

Accepted Answer

A) True 
 B)False

Question 14

The American opportunity tax and lifetime learning credits are not available to taxpayers who are married filing separately.

Accepted Answer

A) True 
 B)False

Question 15

Edward and Ethel are ages 71 and 59, respectively, and file a joint return. They have AGI of $11,000 and received $2,000 in nontaxable social security benefits. How much can Edward and Ethel take as a credit for the elderly or the disabled?

Accepted Answer

A)  $375. 
B)  $1,125. 
C)  $2,000. 
D) $2,500.

Question 16

Clarisse's filing status is head of household. She has modified adjusted gross income of $29,000 and she made a $2,000 contribution to her IRA. What is the amount of her retirement savings contributions credit?

Accepted Answer

The answer of Clarisse's filing status is head of household....

Question 17

Patricia is single and her son Quinn is age 11. If her AGI is $77,000, what amount of child tax credit can she claim?

Accepted Answer

A)  $0. 
B)  $400. 
C)  $900. 
D) $1,000.

Question 18

Dean and Sue are married filing jointly with AGI of $28,000. They made a $1,500 contribution to a qualified retirement plan. How much is their retirement savings contributions credit?

Accepted Answer

A)  $0. 
B)  $150. 
C)  $300. 
D) $750.

Question 19

Waseem has $103,000 total taxable income, which includes $11,000 of taxable income from India. He paid $4,000 in foreign income taxes and his U.S. tax liability is $21,610. Waseem's foreign tax credit is: (Do not round interim calculations)

Accepted Answer

A)  $0. 
B)  $2,200. 
C)  $2,308. 
D) $4,000.

Question 20

Sam and Edna are married with three dependents. They enrolled in a qualified plan through the Marketplace at a cost of $4,900 per year. Their household income was $64,500. Their SLCSP premium is $5,540. What is their premium tax credit?

Accepted Answer

A)  $864. 
B)  $4,676. 
C)  $4,900. 
D) $5,540.

Exam 9: Tax Credits

Which of the following is not a qualifying child for purposes of calculating the EIC?

Which of the following statements is false regarding the earned income credit (EIC) ?

Sandra is single and her son Julius is 12 years old. If her AGI is $79,000, what amount of child tax credit can Sandra claim?

Which of the following statements is correct?

The adoption credit is only available for domestic adoptions.

Which of the following statements regarding adoption credits is not true?

Jesus and Mindy have modified AGI of $210,000, adopted a girl from Miami, Florida, and incurred a total of $18,000 in qualified adoption expenses. What is the amount of adoption credit they can claim in the current year? (Do not round interim calculations)

The earned income credit is available for taxpayers with children only.

Taxpayers with household income between 100% and 400% of the Federal Poverty Level are generally eligible for a premium tax credit.

If the modified AGI of a married filing joint taxpayer exceeds $130,000 in 2015, the lifetime learning credit phases out completely.

Noah and Olivia have two boys, Jordan, age 6 and Jack, age 5. Their AGI is $176,000. What amount of child tax credit can they claim?

The American opportunity tax credit phases out beginning at $80,000 of modified AGI for single taxpayers.

The American opportunity tax and lifetime learning credits are not available to taxpayers who are married filing separately.

Edward and Ethel are ages 71 and 59, respectively, and file a joint return. They have AGI of $11,000 and received $2,000 in nontaxable social security benefits. How much can Edward and Ethel take as a credit for the elderly or the disabled?

Clarisse's filing status is head of household. She has modified adjusted gross income of $29,000 and she made a $2,000 contribution to her IRA. What is the amount of her retirement savings contributions credit?

Patricia is single and her son Quinn is age 11. If her AGI is $77,000, what amount of child tax credit can she claim?

Dean and Sue are married filing jointly with AGI of $28,000. They made a $1,500 contribution to a qualified retirement plan. How much is their retirement savings contributions credit?

Waseem has $103,000 total taxable income, which includes $11,000 of taxable income from India. He paid $4,000 in foreign income taxes and his U.S. tax liability is $21,610. Waseem's foreign tax credit is: (Do not round interim calculations)

Sam and Edna are married with three dependents. They enrolled in a qualified plan through the Marketplace at a cost of $4,900 per year. Their household income was $64,500. Their SLCSP premium is $5,540. What is their premium tax credit?