Question 1

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.

Accepted Answer

A) True 
 B)False

Question 2

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

Accepted Answer

A)  the beginning of the year
B)  the end of the year
C)  the middle of the year
D)  None of theseE) None of the above
F) B) and D)

Question 3

All of the following are tests for determining qualifying relative status except ______.

Accepted Answer

A)  Relationship test
B)  Gross income test
C)  Support test
D)  Residence testE) All of the above
F) B) and D)

Question 4

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.

Accepted Answer

A) True 
 B)False

Question 5

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?

Accepted Answer

A)  $5,000 taxes due.
B)  $1,000 taxes due.
C)  $1,000 tax refund.
D)  $3,000 taxes due.Gross tax liability minus credits minus payments equals taxes due ($7,000 - 2,000 - 4,000 = $1,000 taxes due)  .E) A) and B)
F) C) and D)

Question 6

Which of the following statements regarding the difference between the requirements for a qualifying child and the requirements for a qualifying relative is false?

Accepted Answer

A)  The relationship requirement is more broadly defined (more inclusive)  for qualifying relatives than for qualifying children.
B)  Qualifying children are subject to age restrictions while qualifying relatives are not.
C)  The support test for qualifying relatives focuses on the support the potential dependent self provides while the support test for qualifying children focuses on the support the taxpayer provides.
D)  Qualifying relatives are subject to a gross income restriction while qualifying children are not.The support test for a qualifying child considers the amount of support the child provided for herself.The support test for a qualifying relative considers the amount of support the taxpayer provided for the prospective dependent.E) B) and C)
F) A) and C)

Question 7

A child who is her parents' qualifying child can claim a personal exemption for herself as long as her parents choose not to claim her as a dependent.

Accepted Answer

A) True 
 B)False

Question 8

Miguel,a widower whose wife died in year 1,maintains a household for himself and his daughter who qualifies as his dependent.Miguel did not remarry.What is the most favorable filing status that Miguel qualifies for in year 3?

Accepted Answer

A)  Single
B)  Qualifying widower
C)  Head household
D)  Married,filing separatelyE) A) and B)
F) A) and C)

Question 9

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

Accepted Answer

A) True 
 B)False

Question 10

Sally received $50,000 of compensation from her employer and she received $400 of interest from a corporate bond.What is the amount of Sally's gross income from these items?

Accepted Answer

A)  $0
B)  $400
C)  $50,000
D)  $50,400E) A) and B)
F) B) and C)

Question 11

If an unmarried taxpayer provides more than half the support for a cousin who lives in the taxpayer's home for the entire year,the taxpayer will qualify for head of household filing status.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following statements regarding personal and dependency exemptions is false?

Accepted Answer

A)  A married couple filing jointly may claim two personal exemptions.
B)  To qualify as a dependent of another,an individual must be a resident of the United States.
C)  An individual who qualifies as a dependent of another taxpayer may not claim a personal exemption.
D)  An individual cannot qualify as a dependent of another as a qualifying relative taxpayer if the individual's gross income exceeds the exemption amount.To qualify as a dependent of another,an individual must be a resident of the United States,Canada,or Mexico.Also,there is no gross income test for a qualifying child.E) A) and D)
F) B) and C)

Exam 4: Individual Tax Overview

Which of the following statements regarding the difference between the requirements for a qualifying child and the requirements for a qualifying relative is false?

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

Correct Answer
verified

If an unmarried taxpayer provides more than half the support for a cousin who lives in the taxpayer's home for the entire year,the taxpayer will qualify for head of household filing status.

Correct Answer
verified

A child who is her parents' qualifying child can claim a personal exemption for herself as long as her parents choose not to claim her as a dependent.

Correct Answer
verified

Which of the following statements regarding personal and dependency exemptions is false?

Correct Answer
verified

All of the following are tests for determining qualifying relative status except ______.

Correct Answer
verified

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.

Correct Answer
verified

Miguel,a widower whose wife died in year 1,maintains a household for himself and his daughter who qualifies as his dependent.Miguel did not remarry.What is the most favorable filing status that Miguel qualifies for in year 3?

Correct Answer
verified

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.

Correct Answer
verified

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?

Correct Answer
verified

Sally received $50,000 of compensation from her employer and she received $400 of interest from a corporate bond.What is the amount of Sally's gross income from these items?

Correct Answer
verified

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

Correct Answer
verified

Exam 4: Individual Tax Overview

Which of the following statements regarding the difference between the requirements for a qualifying child and the requirements for a qualifying relative is false?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

If an unmarried taxpayer provides more than half the support for a cousin who lives in the taxpayer's home for the entire year,the taxpayer will qualify for head of household filing status.

Correct AnswerverifiedShow Answer

A child who is her parents' qualifying child can claim a personal exemption for herself as long as her parents choose not to claim her as a dependent.

Correct AnswerverifiedShow Answer

Which of the following statements regarding personal and dependency exemptions is false?

Correct AnswerverifiedShow Answer

All of the following are tests for determining qualifying relative status except ______.

Correct AnswerverifiedShow Answer

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.

Correct AnswerverifiedShow Answer

Miguel,a widower whose wife died in year 1,maintains a household for himself and his daughter who qualifies as his dependent.Miguel did not remarry.What is the most favorable filing status that Miguel qualifies for in year 3?

Correct AnswerverifiedShow Answer

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.

Correct AnswerverifiedShow Answer

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?

Correct AnswerverifiedShow Answer

Sally received $50,000 of compensation from her employer and she received $400 of interest from a corporate bond.What is the amount of Sally's gross income from these items?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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