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Exam 4: Individual Income Tax Overview, Exemptions, and Filing Status

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Question 61

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Greg is single.During 2017,he received $60,000 of salary from his employer.That was his only source of income.He reported $3,000 of for AGI deductions and $7,000 of itemized deductions.The 2017 standard deduction amount for a single taxpayer is $6,350 and the 2017 exemption amount is $4,050.What is Greg's taxable income?

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$45,950,co...

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Question 62

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Doug and Lisa have determined that their tax liability on their joint return is $3,700.They have made prepayments of $1,000 and also are entitled to child tax credits of $2,000.What is the amount of their tax refund or taxes due?

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$700 taxes due ($3,7...

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Question 63

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The Inouyes filed jointly in 2017.Their AGI is $78,000.They reported $16,000 of itemized deductions and they have two children,one of whom qualifies as their dependent.The 2017 standard deduction amount for MFJ taxpayers is $12,700 and each exemption is $4,050.What is the total amount of from AGI deductions they are allowed to claim on their 2017 tax return?

An individual may be considered as a qualifying child of her parents and a qualifying child of her grandparents in the same year.

Kabuo and Melinda got married on December 15,year 1.Kabuo's salary for the year was $54,000,and Melinda's was $62,000.In addition,Kabuo received $250 of interest income,($100 of which was from municipal bonds),and Melinda received $10,000 of alimony from a former spouse.If Kabuo and Melinda choose to file jointly,what is their year 1 gross income?

In February of 2016,Lorna and Kirk were married.During 2017,Lorna received $40,000 of compensation from her employer and Kirk received $30,000 of compensation from his employer.The couple together reported $2,000 of itemized deductions.Lorna and Kirk filed separately in 2017.What is Lorna's taxable income and what is her tax liability (use the applicable tax rate schedule in the text)?

In addition to the individual income tax,individuals may be required to pay taxes imposed on tax bases other than the individual's regular taxable income.

For purposes of the qualifying child residence test,a child's temporary absence from the taxpayer's home for attending school full-time is counted as though the child lived in the taxpayer's home during the absence.

The standard deduction amount for married filing separately taxpayers (MFS)is less than the standard deduction amount for married filing jointly taxpayers.

Jamison's gross tax liability is $7,000.Jamison had $2,000 of available credits and he had $4,000 of taxes withheld by his employer.What is Jamison's taxes due (or taxes refunded) with his tax return?

When determining whether a child meets the qualifying child support test for the child's grandparents,scholarships earned by the child do not count as self-support provided by the child.

In April of year 1,Martin left his wife Marianne.The couple has two children under the age of 15.While the couple was apart,they were not legally divorced.Marianne remained in the home and paid all the costs of maintaining the home for the remainder of the year.Assuming the couple does not file jointly,which of the following statements regarding filing status is true?

To determine filing status,a taxpayer's marital status is determined on January 1 of each tax year in question.

In June of year 1,Jake's wife Darla died.The couple did not have any children and Jake did not remarry in year 1 or year 2.Which is the most favorable filing status for Jake in year 2?

If an unmarried taxpayer is able to claim a dependency exemption for another individual,the taxpayer is automatically eligible for the head of household filing status.

A taxpayer may qualify for the head of household filing status if she has no dependent children but pays more than half of the cost of maintaining a separate household for her dependent mother and/or father.

By the end of year 1,Harold and Jamie Allred had been married for 30 years and have filed a joint return every year of their marriage.Their three sons,Jacob,Larry,and Andi,are ages 13,16,and 23 respectively and all live at home and are fully supported by their parents.Andi is employed full time,earning $17,000 in year 1.How many exemptions are Harold and Jamie entitled to claim?

Certain types of income are taxed at a lower rate than ordinary income.

For filing status purposes,the taxpayer's marital status is determined at what point during the year?

Tax credits are generally more valuable than tax deductions because tax credits reduce a taxpayer's gross tax liability dollar for dollar while tax deductions do not.