Tax Exam I Study Guide

What are the three tests that both children and relatives must pass?

1. Dependent taxpayer test 2. Joint return test 3. Citizen/Resident test

Explain what it means for a qualifying child to pass the support test.

Child cannot have provided more than half of his/her own support during the tax year.

Explain what it means for a qualifying child to pass the relationship test.

Child must be the taxpayers son, daughter, step child, foster child, or a descendant of any of them.

Explain what it means for a qualifying child to pass the residency test.

Child must live with taxpayer for more than half the year.

Explain what it means for a qualifying child to pass the age test.

Child under 19 years old at the end of the tax year and younger than the taxpayer/spouse. Full time student under 24 years old at the end of the year. Any age if permanently and totally disabled at any time during the year.

Chloe is divorced and has one child, Timmy. During the tax year, Timmy lived with Chloe 210 nights and with his farther 155 nights. Who is the custodial parent?

Chloe

Substantial authority includes:

Court cases.

Which of the following is considered taxable income? a. Child support b. Insurance proceeds c. Veterans benefits d. Interest

D. Interest

Diane and her brother each provide 20% of their grandmother's support for the year. Two persons who are not related to Diane's grandmother, and who do not live with her, provide the remaining 60% of her support equally. Who is entitled to claim the grandmother as a dependent? a. Diane b. Diane's brother c. One of the two persons providing the remaining 60% of support d. No one

D. No one

How many taxpayers can claim a child?

One

Lucy is 36 years old and single. Her gross income is $20,000. Is Lucy required to file a tax return?

Yes, Lucy must file since her income exceeds the amount for her age and filing status.

The For penalty for the understatement of liabilities due to willful, reckless, and intentional disregard of the rules is the greater of:

$5,000 or 75% of the income

List three examples of nontaxable income.

1. Child support 2. Gifts 3. Inheritance Note: Table B obtains examples of nontaxable income.

What are the five pieces of information needed to determine if a taxpayer must or should file a return?

1. Date of birth 2. Income questions 3. Marital status 4. If the taxpayer can be claimed as a dependent on someone else's return 5. Taxpayer's potential dependents

List and briefly define the five filing statuses (from most to least beneficial).

1. Married Filing Jointly: Married taxpayers who choose to file a joint return will use on return to report their combined income and to deduct combined allowable expenses. 2. Qualifying Widow(er): Taxpayers who do not remarry in the year their spouse dies can file jointly with the deceased spouse. For the two years following the year of death, the surviving spouse may be able to use the Qualifying Widow(er)'s filing status. 3. Head of Household: Taxpayers who are unmarried or "considered unmarried" on the last day of the tax year, and paid more than half the cost of keeping up a home for the required period of time, and had a qualifying person living in their home for more than half the year (except for temporary absences, such as school). 4. Single: Taxpayers who are legally separated or divorced, widowed before the beginning of the tax year and did not remarry, or not married. 5. Married Filing Separately: Taxpayers who are married and either choose to file separate returns or cannot agree to file a joint return.

Single taxpayers could also potentially qualify for which other three statuses?

1. Married filing separately 2. Head of household 3. Qualifying widow(er)

What are the three requirements for a taxpayer to qualify as head of household?

1. Unmarried or "considered unmarried" on the last day of the tax year, and 2. Paid more than half the cost of keeping up a home for the required period of time, and 3. Had a qualifying person living in their home for more than half the year (except for temporary absences such as school)

List five examples of taxable income.

1. Wages, salaries, bonuses, commissions 2. Business income/self-employment 3. Military pay 4. Rent (gross rent) 5. Social security benefits Note: Table A obtains examples of taxable income.

How long can you use the qualifying widower's status after your spouse's death?

2 years following year of death.

A taxpayer cannot claim a qualifying child dependent if that child provides more than how much of their own support?

50%

Explain what it means to pass the joint return test.

A married person who does not file a joint return can be claimed as a dependent.

Who may choose to file under either the Married Filing Jointly or the Married Filing Separately status? a. A married taxpayer whose spouse does not have income b. A divorced taxpayer who itemizes deductions c. Taxpayers who are legally separated and share child custody

A. A married taxpayer whose spouse does not have income

Ronald was widowed before the first day of the tax year and did not remarry during the tax year. He has no children. For the purpose of determining filing status, Ronald is considered ________. a. Single b. Married c. Qualified widow

A. Single

Reasonable cause and good faith penalty exceptions include which of the following:

All of the below: - Nature of the error causing the understatement - Frequency and materiality of the error - Office practice

Due diligence requirements relate to which of the following:

American opportunity tax credit

Contingent fees may be charged under which of the following:

An IRS examination

What are personal exemptions?

An exemption is a dollar amount that can be deducted from and individual's total income, thereby reducing the taxable income. Personal exemptions generally allow taxpayers to claim themselves (and possibly their spouse).

Which of the following is NOT a test for qualifying relatives? a. Not a qualifying child b. Age c. Member of household or relationship d. Gross Income e. Support

B. Age

Married Filing Jointly means that the spouses ____________. a. Report their own incomes and deductions on separate returns b. Combine their income and deductions on the same return.

B. Combine their income and deductions on the same returns.

Depending on specific tax situations, taxpayers can file using ______. a. Form 1040-NR b. Form 1040-SR c. Form 1040 d. B and C

B. Form 1040-SR Note: Most taxpayers must use Form 1040, but form 1040-SR may be used by taxpayers who are age 65 or older at the end of the tax year.

To determine if a widowed taxpayer can use the Qualifying Widow(er) status, you need to know all the following information EXCEPT _____. a. The year the spouse died b. If the taxpayer filed a joint return for the year the spouse died c. Whether the taxpayer furnished more than half the cost for keeping up the main home of a qualified child d. That the taxpayer did not remarry before the end of the tax year

B. If the taxpayer filed a joint return for the year the spouse died.

Which of the following individuals could use Chart A to determine if they must file a tax return? a. Mrs. Harlan, 68, who is recently widowed and supported by her son. b. Mrs. Fulton, 70, who is single and whose only sources of income are her pension and investments. Her income was less than $10,000. c. Mr. Emmet, 45, a stay-at-home dad filing Head of Household, whose income is $6,000 and who received Form 1095-A showing Advanced Premium Tax Credit (APTC).

B. Mrs. Fulton, 70, who is single and whose only sources of income are her pension and investments. Her income was less than $10,000. Note: Mrs. Harlan can be claimed as a dependent on her son's return, so she must use Chart B. Mr. Emmet must use Chart C.

Yolanda and Sean Mercer want to file under the Married Filing Separately status. If Yolanda wants to itemize deductions, then _____. a. They will have to file jointly b. Sean must either itemize his deductions or claim a zero standard deduction c. Sean must take the standard deduction d. They will have to use Form 1040A

B. Sean must either itemize his deductions or claim a zero standard deduction.

To be considered married on your tax return for 2020, when do you have to be married by?

By the last day of the tax year.

Larry and Zelda are married but will not file a joint return. Both are under 65. Larry's gross income from wages is $30,150 and Zelda's is $4,100. Which of the following is true? a. Just Larry is required to file b. Just Zelda is required to file c. Both Larry and Zelda are required to file d. Neither Larry nor Zelda must file

C. Both Larry and Zelda are required to file. Note: Chart A shows that taxpayers of any age who use the Married Filing Separately status must file a return if they had a gross income over $5.

Which of the following is not a test for qualifying children? a. Relationship b. Age c. Gross Income d. Residency e. Support

C. Gross Income

For the purpose of determining filing status, which of the following taxpayers would be considered unmarried for the tax year? a. Kris, who did not get married until December of the tax year. b. Torre, whose spouse died in February of the tax year. c. Hal, who was married until his divorce in November of the tax year.

C. Hal, who was married until his divorce in November of the tax year. Note: Taxpayers are considered single if on the last day of the tax year, they are legally divorced.

Which of the following meets the member of household or relationship test for taxpayer John Smith? a. John Smith's 10-year old cousin who lives with John's parents, but is supported by John. b. John's foster parent who did not live with John. c. John's foster child who has lived with him for seven months and is cared for by John as his own. d. John's great aunt who did not live with him.

C. John's foster child who has lived with him for seven months and is cared for by John as his own.

Which of the following can be used to verify a taxpayer's Social Security number and correct name spelling? a. Driver's license b. Passport c. Social security card d. Birth certificate

C. Social Security Card Note: A driver's license or passport should not be used in lieu of SSA records.

The Jackson family would like to claim their daughter and son-in-law as dependents. Which of the following must be true in order for the daughter and son-in-law to meet the joint return test? a. Their combined income cannot exceed $3,500 b. They must live with the Jackson family c. They must not have filed a joint return except to claim a refund of withheld income tax or estimated tax paid d. They must be under the age of 24 at the end of the year.

C. They must not have file a joint return except to claim a refund of withheld income tax or estimated tax paid

In 2010, Claudia and her spouse Raymond adopted two-year-old Rachel. Although eligible to file jointly, Claudia and Raymond always filed separately. In October 2020, Claudia's spouse died. She continued to support Rachel and she did not remarry.Which filing status should Claudia use for 202-?

Either Married Filing Jointly or Married Filing Separately.

True or False? Janet and Harry are married, file jointly, and lived together all year. During the tax year, Janet turned 66 and Harry turned 64. Their gross income was $18,000. Based only on this information, they are required to file a tax return.

False

True or False? Jennifer Rawls, an eighteen-year-old single mother who can be claimed as a dependent by her parents, can claim her infant son as a dependent on her own tax return.

False

Fred has always filed a joint return with his spouse. His spouse passed away in August 2020. Fred provides all the support for his two dependent children, ages 7 and 9. If Fred does not remarry, which filing status could he use for the following tax years? a. 2020 b. 2021 c. 2022 d. 2023

For 2020, he can file for married filing jointly. For 2021, he can find for qualifying widower. For 2022, he can file for qualifying widower. For 2023, he can file for head of household.

What does Chart B tell you?

For children and other dependents.

What does Chart A tell you?

For most people who must file-- Whether or not a person needs to file a tax return.

What does Chart D tell you?

For who should file even if the taxpayer is not required to file a federal income tax return.

Joan, who is a U.S. citizen, adopted an infant boy from Cambodia who lived with her for the entire tax year. Even though Joan's child is not yet a U.S. citizen, why is Joan able to claim her son as a dependent?

He lived with her for the entire year.

Dick's spouse died in 2017 and he has not remarried. Dick has provided all the support for his two dependent children.Which filing status should Dick use for 2020?

Head of Household

Elaine Smith has one Form W-2 from her clerk job of 36 years, showing wages of $37,000. She has been divorced from her husband for over 20 years. She pays all the costs of keeping up her home and is the main provider for her seven-year-old granddaughter, Lisa and her 30-year-old son, Todd. Lisa is Todd's niece. Both her son and granddaughter lived with Elaine all year. Her son worked part time and earned $9,000. He is not disabled. She would like to file a tax return and claim her son and granddaughter as dependents. To help Elaine, you would first use the interview tips in the Volunteer Resource Guide to ask about each of her sons and grandchildren.

Her granddaughter only.

Jessica has been raising her son, Jim, alone since her husband died 5 years ago. This year, Jessica earned $25,000. Jim, who lives with Jessica, is single, and does not provide more than half of his own support. He was 19 years old on September 17. Jim is not a full-time student and is not disabled. He worked for a short time at a fast food restaurant and made about $1,800. Jessica and Jim are both U.S. citizens and have SSNs.Is Jim the qualifying child or qualifying relative of Jessica?

Jim meets the requirements for being Jessica's qualifying relative.

Bob and Judy live together and are not married. They have one child together, Katie, who is 4 years old. Bob, Judy, and Katie are U.S. citizens and have SSNs. Katie did not provide any of her own support and lived with Bob and Judy all year. Bob's AGI is $18,500 and Judy's AGI is $14,000. They had no other income. Neither Bob nor Judy can be claimed as a dependent by any other taxpayer. Bob pays for Katie's daycare so he and Judy can work. Bob pays over half of the costs of maintaining their home.Who may claim Katie as their qualifying child, and what can be claimed on the return?

Katie is a qualifying child for both Bob and Judy. If they agree and Bob claims Katie, he can claim the Head of Household filing status, the child tax credit, the child and dependent care credit, and the earned income credit if all other rules are met.

Tax preparers censured for not adhering to Circular 230 are:

Listed in the Internal Revenue Bulletin

Lily left her spouse in August of the tax year. She took all her children with her, supported them the entire year, and claims them as dependents. She will not file a joint return with her spouse.

Married Filing Separately

If your spouse passes away in May 2020, which filing status should you use for your 2020 taxes?

Married filing jointly

Are taxes usually higher for couples choosing married filing separately or married filing jointly?

Married filing separately.

Mary and Ralph were divorced four years ago. They have one child together, Amy, who lives with Mary. All are U.S. citizens and have SSNs. Mary and Ralph provide more than half of Amy's support. Mary's AGI is $31,000 and Ralph's AGI is $39,000. Amy is 12 years old. The divorce decree does not state who can claim the child.Which of the following is true?

Mary can sign Form 8332 so Ralph can claim Amy as a dependent and he can claim the child tax credit. Mary can use the Head of Household filing status, and she can claim the earned income credit and the child and dependent care credit as long as she meets the requirements for those specific benefits.

In a conflict of interest, the tax preparer:

May continue to represent all parties if they are able to do so competently and diligently, providing it is not prohibited by law and all parties waive the conflict in writing within 30 days.

For a relative to qualify a taxpayer to be Head of Household, how long must the taxpayer's home be the main home of the relative?

More than half the year.

Base your answer on the previous case study facts regarding Todd and Eva except that Eva's gross income is $25,000 and she is required to file a return. In this situation, are the children Todd's qualifying relatives?

No

Joe is 65 years old and lives with his son and daughter-in-law. Joe's taxable pension income for the year was $10,000. Can Joe's son and daughter-in-law claim him as a dependent?

No

Randy's son, Paul, is not a qualifying child. Paul earned $6,800 from a part-time job. Does he meet the gross income test for a qualifying relative?

No

Sally has been supporting her friend, Ann, and Ann's young son, Bobby. Ann and Bobby lived with Sally the entire year and meet all the tests to be Sally's qualifying relatives. Ann worked part-time and made $3,100 in wages. Ann files a return and claims her son for the earned income credit. Can Sally claim Bobby as a dependent?

No

Steve provided $4,000 toward his mother's support during the year. His mother had nontaxable Social Security benefit payments of $4,800, and tax-exempt interest of $800. She used all of these for her support. Can Steve claim his mother as a dependent?

No

Steve provides $4,000 toward his mother's support during the year. His mother has earned income of $600, nontaxable Social Security benefit payments of $4,800, and tax-exempt interest of $200. She uses all of these for her support. Can Steve claim his mother as a dependent if she meets all other tests?

No

Michael provided all the cost of keeping up his home for the year. Michael's son Justin lived with him the entire year. Justin is 22 and was not a full-time student during the tax year, so he cannot be Michael's qualifying child. Although Justin only worked part-time, he earned too much for Michael to claim him as a qualifying relative dependent. Can Michael file Head of Household? Explain.

No, because Michael's child is not a qualifying child; therefore, he does not have a qualifying child.

Jane and Todd are not married. They have one daughter together, Amanda. Jane and Amanda lived together all year in an apartment. Todd lived alone. Todd earns a lot more than Jane, and helps her out with living expenses. He paid over half the cost of Jane's rent and utilities. He also gave Jane extra money for groceries. Todd does not pay any expenses or support for any other family member. Can Todd file Head of Household? Explain.

No, because Todd does not have a qualifying child that lived with him for more than half the year.

Alexandra's younger brother, Sebastian, is seventeen years old. Sebastian lived with his grandparents for the first two months of the year. From March through July, he lived with Alexandra. On August 1, Sebastian moved in with some friends and stayed there for the rest of the year. Since Sebastian did not have a job, Alexandra gave him money every month. Assuming Alexandra had no other dependents, can she file as Head of Household? Explain.

No, because her brother did not live with her for more than half the year.

Can a person claim a deduction for personal exemptions for tax year 2022?

No.

Kathy, divorced with no children, lived with her unemployed roommate, Sandra, for the entire year. Kathy had to pay more than half of the cost of keeping up their apartment. Can Kathy use the Head of Household filing status?

No.

Laura has always filed a joint return with her spouse, who died in September of the tax year. Laura, who did not remarry, provides all the support for her two dependent children, ages 7 and 9. Should Laura file as a Qualifying Widow(er)

No.

Trudy, 66, qualifies for Head of Household filing status and had $10,900 in gross income. Is she required to file a return?

No. Chart A shows that a Head of Household who is 65 or older does not have to file unless she had at least $20,000 in gross income.

Is Melvin required to file a tax return? Melvin is 20 years old, single, a full-time student, and a U.S. citizen with a valid Social Security number. During the interview with Melvin, you learn that: - Melvin's only income was $6,400 in wages - He lived with his parents all year, but they told him they will not claim him on their 2020 return.

No. Chart B (for children and other dependents) state that people younger than 65 who earn over $12,200 must file a return.

Are the only acceptable means of verifying taxpayer's identity a valid U.S. driver's license, passport, or military ID?

No. Other acceptable means are a current state ID, visa, national ID, employer ID, school ID, or other proof to taxpayer identification.

Henrietta and Javier are married and plan to file a joint return. Henrietta is 67 and had a gross income of $11,000 for the tax year. Javier is 66. His gross income was $5,000 for the year. Do they need to file a tax return?

No. Since their combined gross income is less than the minimum amount for their ages and filing status, then they do not have to file a return.

If a taxpayer cannot obtain a valid Social Security number and has not yet applied for a taxpayer identification number, can you use the taxpayer's driver's license or passport instead?

No. Taxpayers must have a valid Social Security number or taxpayer identification number before you can assist them.

To determine if a taxpayer must file a tax return, do you need to know their income for the year, filing status, and place of birth?

No. You need to know their approximate income, likely filing status, and age.

What does Chart C tell you?

Other situations when a person must file.

Phil is a widower who works full-time and has an AGI of $35,000. He supports his 16-year-old daughter, Mariah, who lives with him in California. Phil's parents also live with him. Phil's parents always file a joint return to pay tax on their pension income, investment income, and Social Security benefits. Phil's parents' AGI is $42,321. Everyone in Phil's family is a U.S. citizen and has SSNs. This tax year, Mariah earned $10,000 working part-time. She put the $10,000 in a college savings account.If Phil and his parents both claim Mariah as a dependent on their returns, who would be entitled to claim Mariah as a dependent based on the tie-breaker rule?

Phil would claim Mariah as a dependent because he is Mariah's parent.

What are the two types of dependents?

Qualifying Child & Qualifying Relative

The two filing statuses that generally result in the lowest tax amounts are Married Filing Jointly and _____.

Qualifying Widow(er)

Samantha is divorced and provided over half the cost of keeping up a hone. Her five-year old daughter, Pam, lived with her for seven months last year. Samantha has signed a written declaration allowing her ex-husband to claim the child as a dependent. Where should you enter Pam's name on Samantha's tax return?

Qualifying child that is single.

Ray and Brenda are not married but they lived together all year and have two children under 10 years of age. Ray paid all the rent, utilities, groceries, and other household expenses. They agreed that each would claim one child on their individual tax returns.What are the correct filing statuses for Ray and Brenda's returns?

Ray can file as Head of Household and Brenda must file as Single.

Circular 230 contains which of the following:

Rules governing those representing taxpayers before the IRS.

Ruth, who had no income, was married in November of the tax year. Ruth's husband had $30,000 in income, and had a filing requirement. Although Ruth's father supported her and paid for the wedding, why is Ruth's father not able to claim her as a dependent?

She cannot claim as a dependent because she's filing a joint return with her husband.

Jack has lived apart from his spouse for several years. Their children live with his spouse, but Jack pays more than half of the children's support. Which filing status can Jack use?

Single

Mrs. Calvin is divorced and lived with her 21-year-old unmarried son, Drew, all year. She paid for all their rent and food, and provided more than half of Drew's total support. She cannot claim Drew as a dependent because he earned $5,000 and is not a student.Which filing status should Mrs. Calvin use?

Single

Tax preparers privileged information is limited to:

Tax advice and noncriminal matters

Explain what it means for a qualifying relative to pass the support test.

Taxpayer must have provided more than 50% of persons total support (& meet other tests) can agree that one will claim the person as a dependent.

Ted is divorced and has a daughter who lived with him and his ex-spouse for an equal number of nights. Ted's adjusted gross income is $45,000 and his ex-spouse's adjusted gross income is $30,000. Who is the custodial parent?

Ted

What are the requirements to be considered as keeping up a home?

The half of the total cost of all expenses divided by its total cost. (Must be more than half to qualify) Expenses - rent, mortgage interest, real estate taxes, home insurance, repairs, utilities, food eaten at home, etc.

What is a custodial parent?

The parent with whom the child lived for the greater number of nights throughout the year.

What records is a tax preparer required to return when a client requests their records back according to Circular 230?

The taxpayer's records to comply with their federal tax obligation

Explain what it means for a qualifying relative to pass the age test.

There is no age test for qualifying relative.

Explain what it means for a qualifying child to pass the gross income test.

There is no gross income test for child.

Explain what it means to pass the citizen or resident test.

To be claimed as a dependent, a person must be a U.S. citizen, U.S. resident, U.S. resident alien of Canada or Mexico, legally adopted child must live with parent all year.

True or False? A resident of Mexico meets the requirements of the citizen or resident test.

True

True or False? Bob is 27 years old. No one can claim him as a dependent. His gross income was $17,000 during the tax year. Based only on this information, Bob is required to file a tax return.

True

True or False? Juanita can file as a Qualifying Widow(er). She is 47 years old. Her gross income was $27,000. Based only on this information, she is required to file a tax return.

True

True or False? The gross income test considers taxable income only, whereas the support test considers all of the dependent's income - both taxable and nontaxable.

True

Explain what it means for a qualifying relative to pass the not a qualifying child test.

When a qualifying relative is not a qualifying child of another taxpayer.

Explain what it means to pass the dependent taxpayer test.

When neither you or your spouse has someone claiming either of you as a dependent, then you can claim a child/relative as a dependent.

Explain what it means for a qualifying relative to pass the gross income test.

When the gross income for the tax year is less than the threshold amount.

Explain what it means for a qualifying relative to pass the member of household or relationship test.

When the qualifying relative either lives as member of the household, or be related to the taxpayer.

Base your answer on the previous case study facts regarding Sally except that Ann files a return only to have her withholding refunded. Can Sally claim Ann and Bobby as dependents?

Yes

Bob is 22 and a full-time student for the entire year. During the tax year, he lived with his parents when he was not in the dorm. During the tax year, he worked part-time, but that income did not pay over half of his total support. Does Bob pass the tests for a qualifying child?

Yes

Doris, a U.S. citizen, is 8 years old and had a small role in a television series. She made $60,000 during the tax year, but her parents put all the money in a trust fund to pay for college. She lived with her parents all year. Does she meet the support test?

Yes

Marie, 18, earned $5,000. Her father provided more than half of her support. If all other dependency tests are met, can her father claim her as a qualifying child dependent?

Yes

Susan and Ted are married and file a joint return. They supported Ted's parents throughout the tax year. Ted's parents do not live with Ted and Susan. Do Ted's parents meet the member of household or relationship test?

Yes

Susan and Ted are married and will file a joint return. They have supported Ted's parents for the majority of the tax year. Ted's parents do not live with Ted and Susan. Do Ted's parents meet the member of household or relationship test?

Yes

Todd has lived all year with his girlfriend, Eva, and her two children in his home. This cohabitation does not violate local laws. Eva is not required to file, and does not file, a tax return this year. Eva and her two children pass the "not a qualifying child test" to be Todd's qualifying relatives. Can Todd can claim them as dependents if he meets all the other tests?

Yes

Tom Brown supports his wife's uncle Jim who lives in another city. The Browns file a joint return. Can the Browns claim Jim as a dependent if all other tests are met?

Yes

Since her spouse died five years ago, Joan has lived with her friend, Mary Ann, who is also a widow. Joan is a U.S. citizen, is single, and lived with Mary Ann all year. Joan had no income and received all of her support from Mary Ann. Joan is Mary Ann's qualifying relative because she lived with Mary Ann all year as a member of her household. May Ann can claim Joan as a dependent on her return. Is Joan a qualifying person for Head of Household filing status? Why or why not?

Yes, Mary Ann is unmarried, has a qualifying person who lived with her all year, and Mary Ann pays for everything.

Nancy is single and lives alone. Nancy's mother, Maxine, lives alone in another city. Maxine receives social security payments, but has no other income. Nancy pays all of the costs of keeping up the home her mother lives in, and provides over half her support. Nancy can claim a dependency exemption for her mother. Can Nancy file Head of Household? Explain.

Yes, because Nancy is single, pays all costs for keeping up the home her mother lives in, and she claims dependency exemption for her mother.

Carol and Roger were married three years ago and have no children. Although they lived apart during the entire tax year, they are neither divorced nor legally separated. Can Carol and Roger use either of the married filing statuses?

Yes.

Martin and Rita got divorced in December, and neither has remarried. Even though Martin supported Rita all year, is he still required to file as Single?

Yes.

Robin, age 20, lived all year with her aunt and uncle and younger sister in an apartment. Robin's total support for the year was $6,000. Robin, who attends college full-time, has a part-time job. During the year, she saved $1,000 toward her next year of college. $500 was withheld for income and Social Security taxes. She spent $2,500 on clothing, transportation, and recreation. Robin provided $2,500 of her own support. Her college savings will not be counted as support until the money is spent. The funds used to pay income and Social Security taxes are not considered to be support. Robin's aunt and uncle provided a total of $3,500 toward her support. Does Robin meet the support test?

Yes.

A taxpayer cannot use a valid ITIN if it was not used on a federal tax return at least once in the last three year.

Yes. ITINs that have not been used on a federal tax return at least once in the last three consecutive years will no longer be valid for use on a tax return unless renewed by the taxpayer.

If the taxpayer with a valid SSN receives a Form W-2 with an incorrect SSN, can you prepare the return using that W-2?

Yes. You can use the original W-2 to prepare the return, but the taxpayer needs request a corrected Form W-2 from the employer before submitting the tax return.