ACC Chapter 4

Which of the following examples results in realized income? A taxpayer borrowed $1,000 from the bank. A taxpayer sold stock for $1,000. She had originally paid $300 for the stock. A taxpayer transferred $1,000 from her checking account to her savings account. A taxpayer held stock that appreciated in value during the year.

A taxpayer sold stock for $1,000. She had originally paid $300 for the stock.

Which one of the following individuals meet the requirements to be a qualifying relative (not a qualifying child) for Owen? Owen provides over half of his son, Vinnie's (age 20) support. Vinnie, a part-time college student, earned $3,800 and lived with Owen. Sandy (age 23) does not provide half of her own support. She is a full-time college student, earned $7,000 this year, and lives with her uncle, Owen. Owen provides over half of his niece, Rani's (age 21) support. Rani is a full-time college student, earned $6,000, and lived with Owen. Ron (age 22) provides over half of his own support. He is a full-time student, earned $12,000, and lived with his cousin, Owen the entire year.

Owen provides over half of his son, Vinnie's (age 20) support. Vinnie, a part-time college student, earned $3,800 and lived with Owen.

Taxpayers pay the same ______ tax rates on qualified dividends and long term capital gains, but the amount of the dividends and long term capital are not ______ together.

Preferred; net

Examples of a tax ______ include income taxes withheld from a taxpayer's salary by an employer, estimated tax payments paid directly to the IRS, and amounts from a prior year overpayment that were applied to the current year's tax liability.

Prepayment

In order to meet the criteria for a ______ ______, the dependent must NOT have provided more than half of his or her own support for the year. However, the support may have been provided by someone other than the taxpayer.

Qualifying child

In order for an individual to be a qualifying relative, rather than a qualifying child, which of the following criteria must be met? (Check all that apply.) The individual must meet an "age test." The individual must meet a "gross income test." The individual must meet a "residence test." The taxpayer does not have to provide over half of the individual's support, but the individual cannot provide over half of his/her own support. The taxpayer must provide over half of the individual's support.

The individual must meet a "gross income test." The taxpayer must provide over half of the individual's support.

Which of the following individuals meet the requirements of a qualifying person for determining head of household filing status? The taxpayer's mother who is dependent of the taxpayer, but lives in her own home which is maintained by the taxpayer The taxpayer's child who resides with his other parent for over half the year, but where the taxpayer gets the earned income credit An unmarried son who is NOT a dependent but lives with his father for most of the year A friend of the taxpayer who is a qualifying relative because he lives with the taxpayer for the entire year

The taxpayer's mother who is dependent of the taxpayer, but lives in her own home which is maintained by the taxpayer

A taxpayer may file as a single taxpayer when: her spouse died during the year she is separated from her husband, but not yet divorced she has been unmarried for over half of the year she is unmarried at the end of the tax year

she is unmarried at the end of the tax year

Will and Lyndsey are married with no dependents and file a joint tax return. In 2023, they paid $3,000 in qualified student loan interest in addition to $25,750 in itemized deductions. What is the total of their "FROM AGI" deductions in 2023? $23,850 $27,800 $27,700 $26,850

$27,700

Amy and Ethan are married and file a joint return for 2023. Their taxable income is $78,500. What is the amount of their tax liability (use the tax rate schedules)? $8,980 5,656 $12,578 $9,420

$8,980

In 2023, Ryan files as head of household and has taxable income of $75,673. None of his taxable income consists of capital gains or qualified dividends. His tax liability rounded to the nearest dollar totals $ (use the tax rate schedules).

10349, 10348, or 10350

Yolanda is your client. With her current level of taxable income, she is paying tax at 24% marginal rate. She received $2,000 in qualified dividends this year. What rate of tax do you expect that Yolanda will pay on her dividends? 24% 15% 0% 20%

15%

In 2023, Ryan files as head of household and has taxable income of $122,500. None of his taxable income consists of capital gains or qualified dividends. Using the tax rate schedule, his tax liability rounded to the nearest dollar, totals $_____. (Enter your answer as a whole number without decimals.)

21,194

Deductible capital losses can offset capital gains. If the losses exceeds the gains, then a maximum of $______ may be used to offset ordinary income in any one year.

3000

Amy and Ethan are married and file a joint return for 2023. Their taxable income is $192,100. The amount of their tax liability, rounded to the nearest dollar, is $ ______

32,904

The gross income test requires that a qualifying relative's gross income for 2023 be less than $

4700

The gross income test requires that a qualifying relative's gross income for 2023 be less than $ ______

4700

In 2023, Ryan files as single and has taxable income of $47,153. None of his taxable income consists of capital gains or qualified dividends. His tax liability rounded to the nearest dollar totals $ _______

5681

Zack is single and has collected the following information for preparing his 2023 taxes: Gross income $74,000, tax credits $2,500, itemized deductions $10,500, deductions for AGI $5,000, tax prepayments $8,400. Based on this information, Zack's "adjusted gross income" equals $ ______, and his "taxable income" equals $ ______

69000, 55150

Which of the following assets are classified as capital assets? (Check all that apply.) Inventory held for sale in a business A house owned and used by a taxpayer Stock held for investment Supplies used in a business

A house owned and used by a taxpayer Stock held for investment

Which of the following would most likely NOT qualify as support for meeting the support test? Summer camp with horseback riding, swimming, and other activities Medical and dental care A riding lawnmower used by a child to mow the family yard A wedding dress

A riding lawnmower used by a child to mow the family yard

Which of the following statements is TRUE regarding the individual income tax formula? A taxpayer may deduct the greater of his standard deduction or his total adjustments (above the line) for AGI. A taxpayer may deduct the greater of his standard deduction or his total deductions (below the line) from AGI. A taxpayer may deduct the greater of his standard deduction or his itemized deductions from AGI to arrive at taxable income. A taxpayer may deduct the greater of his standard deduction or his itemized deductions for AGI to arrive at adjusted gross income.

A taxpayer may deduct the greater of his standard deduction or his itemized deductions from AGI to arrive at taxable income.

A taxpayer who is married at the end of the year, but lived apart from the other spouse for the last six months of the year, may qualify as a(n) ______ ______ and be able to use the head of household filing status.

Abandoned spouse

The four tests that must be met to qualify as a qualifying child are: ______ , ______ , ______ , and ______.

Age, relationship, residence, support

Under a multiple support agreement, taxpayers who DON'T pay over half of an individual's support may still be allowed to claim the individual as a dependent if which of the following rules apply? (Check all that apply.) All other individuals contributing more than 10 percent support provides statements to taxpayer agreeing NOT to claim the individual as a dependent. The taxpayer and at least one other person provided over one-half of the support of the individual. The individual earns more than the gross income test amount ($4,700), but NOT enough to provide half of his support. The taxpayer contributed over 5 percent of the individual's support for the year. No one taxpayer paid over one-half of the individual's support.

All other individuals contributing more than 10 percent support provides statements to taxpayer agreeing NOT to claim the individual as a dependent. The taxpayer and at least one other person provided over one-half of the support of the individual. No one taxpayer paid over one-half of the individual's support.

In addition to the individual income tax, individuals may be required to pay other taxes. Taxpayers with a large amount of tax preference items and itemized deductions may be subject to the ______ ______ tax.

Alternative minimum

Which one of the following individuals CANNOT meet the residence test for being a qualifying child of another taxpayer? Amy lived with her parents until the end of April. She moved into an apartment on May 1. Cathy was injured in a car accident in February. She remained in the hospital until September. Steven graduated from college in May and moved back in with his parents for two months. He moved out on July 15. Justin attends college in a different state than where his parents live.

Amy lived with her parents until the end of April. She moved into an apartment on May 1.

Which of the following choices are forms of tax prepayments? (Check all that apply.) An overpayment of taxes in the prior year that was applied as an estimated payment for the current year A tax refund received in the current year for the prior year A tax credit used to reduce the tax liability in the current year Income tax withheld from a taxpayer's salary or wages by an employer Estimated tax payments the taxpayer made directly to the IRS

An overpayment of taxes in the prior year that was applied as an estimated payment for the current year Income tax withheld from a taxpayer's salary or wages by an employer Estimated tax payments the taxpayer made directly to the IRS

Andrew is trying to determine if Annie will qualify as his dependent. She will NOT meet the criteria for a qualifying child, so Andrew is checking to see if she is a qualifying relative. Assuming there is NOT a multiple support agreement involved, which one of the following criteria for the support test must be met in order for Annie to be considered a qualifying relative for Andrew? Annie must NOT provide over half of her own support, but it doesn't matter who is providing the support. Annie must be related to the Andrew in order to meet the support test. Annie must live with the Andrew for over half of the year in order to meet the support test. Andrew must provide over half of Annie's support for the year.

Andrew must provide over half of Annie's support for the year.

Ashley and Roland were married and had two dependent children. Roland died last year. What filing status will Ashley use for the year Roland died and for the current year (assuming she does not remarry)? Ashley must use married filing separately in the prior year and head of household in the current year. Ashley will use qualifying widower in the prior year and head of household in the current year. Ashley will use qualifying widower for both years. Ashley will use married filing jointly in the prior year and qualifying widow in the current year.

Ashley will use married filing jointly in the prior year and qualifying widow in the current year.

Which filing status is best for a married couple that lives together, but one spouse does NOT want to be liable for the other spouse's tax liability? One individual should file "head of household" and the other individual should file "single." Both individuals should file "single." Both individuals should file "married filing separately." Both individuals will be liable for the tax liability if they are married. Filing status is irrelevant.

Both individuals should file "married filing separately."

Which of the following statements is CORRECT? Both tax deductions and tax credits are a matter of legislative grace. Both tax deductions and tax credits are specifically granted by Congress and are narrowly defined. Both tax deductions and tax credits reduce taxable income.

Both tax deductions and tax credits are specifically granted by Congress and are narrowly defined.

Which of the following statements is INCORRECT? Certain types of realized income items may be deferred to a subsequent year, but no income may be excluded from taxation. Realized income items that taxpayers include in gross income in a subsequent year are called deferrals. Realized income items that are permanently excluded from gross income are referred to as exclusions.

Certain types of realized income items may be deferred to a subsequent year, but no income may be excluded from taxation.

Hillary, Craig, and David provide 60% of the support for their elderly aunt, Brooke. Hillary provides 8%, while Craig provides 40% and David provides 12%. Which of the taxpayers are eligible to claim Brooke as a dependent? Hillary, Craig and David Only Craig Craig and David No one

Craig and David

A tax ______ reduces taxable income and a tax ______ reduces the tax liability dollar for dollar.

Deduction, credit

All sources of income are taxable unless specifically excluded through a tax provision. However, ______ are NOT permitted unless a specific tax provision allows them.

Deductions

Sharon Jones is single. During 2023, she had gross income of $159,800, deductions for AGI of $5,500, itemized deductions of $15,000 and tax ______ credits of $2,000. Sharon had $22,000 withheld by their employer for federal income tax. She has a tax (due/refund) rounded to the nearest whole dollar of $ ______.

Due, 2832

Realized income items that taxpayers permanently omit from income are referred to as ______, while items that are taxed in a subsequent year are called ______

Exclusions; deferrals

True or False: Commuting costs are classified as itemized deductions for tax purposes.

False

True or false: An individual will qualify as a qualifying child if he satisfies at least one of the following tests: age, support, relationship, and residence.

False

True or false: Depreciable assets used in a trade or business are classified as capital assets.

False

True or false: In order to meet the support test for a qualifying child, the taxpayer must provide more than half of the individual's support for the year.

False

Which of the following statements is correct regarding the choice of a taxpayer's filing status? Filing status depends on marital status and whether the taxpayer has dependents. Filing status depends on the level of income generated by the taxpayer. Filing status depends on the gender of the taxpayer. Filing status depends on the age of the taxpayer.

Filing status depends on marital status and whether the taxpayer has dependents.

How does a taxpayer determine which filing status to use? (Check all that apply.) Filing status depends on whether or not the taxpayer is married at the end of the year. Filing status depends on the amount of taxable income the taxpayer has for the year. Filing status may depend on whether or not the taxpayer has dependents. Filing status depends on the age of the taxpayer.

Filing status depends on whether or not the taxpayer is married at the end of the year. Filing status may depend on whether or not the taxpayer has dependents.

Expenses such as alimony paid for divorces finalized before 1/1/2019, contributions to qualified retirement accounts, and business expenses for self-employed persons are deductions ______ AGI.

For

Why are for AGI deductions preferable to from AGI deductions? For AGI deductions are only taken if itemized deduction exceeds standard deduction. For AGI deductions cause a dollar for dollar drop in tax liability. For AGI deductions reduce AGI thus increasing deductibility of from AGI deductions based on AGI.

For AGI deductions reduce AGI thus increasing deductibility of from AGI deductions based on AGI.

Which of the following individuals would meet the relationship test for being a qualifying relative of the taxpayer if s/he has only lived with the taxpayer for eight months of the year? (Check all that apply.) Grandchild Friend Brother Father Cousin Niece

Grandchild Brother Father Niece

Put the following items in the order in which they are found in the individual income tax formula. Gross income Minus for AGI deductions Equals adjusted gross income Minus from AGI deductions Equals taxable income

Gross income Minus for AGI deductions Equals adjusted gross income Minus from AGI deductions Equals taxable income

The all-inclusive concept means that ______ ______ generally includes all realized income from whatever source derived.

Gross; income

When a divorced taxpayer pays over half the cost of maintaining a home where she and a dependent child lived for over half the year, she qualifies for which filing status? Head of household Qualifying widower Single Married filing separately

Head of household

If a taxpayer is unmarried for the entire year, which of the following filing statuses could possibly be used by the individual? (Check all that apply.) Head of household Married filing separately Single Divorced Married filing jointly Qualifying widow or widower

Head of household Single Qualifying widow or widower

When is it possible for a qualifying person for determining head of household status to NOT live with the taxpayer? If the person is the child of the taxpayer, but lives with the other parent If the person is the parent of the taxpayer If the person is the married child of the taxpayer

If the person is the parent of the taxpayer

Which one of the following choices is the definition of realized income? Income that is subject to federal income tax Income from a transaction with a second party where there is a measurable change in property rights between parties Income consisting of cash receipts only - not bartering or credit transactions Income that must be reported on the current year's tax return

Income from a transaction with a second party where there is a measurable change in property rights between parties

For tax years beginning in 2018, a taxpayer's from AGI deductions include the greater of the standard deduction or the taxpayer's ______ deductions and 20% of the taxpayer's qualified ______ income.

Itemized, business

Corey is 25 and has a full-time job. His younger brother, James, is 20 and was enrolled as a full-time student at the community college during the summer and fall semesters. James lives with Corey. Which of the following statements is correct with respect to the age requirement for a qualifying child? James must be older than than Corey in order to meet the age test. James meets the age test because he is younger than Corey, and he is under age 24 and a full-time student. James does NOT meet the age test because he was not enrolled as a full-time student for the entire year. James does NOT meet the age test because he is not under the age of 19.

James meets the age test because he is younger than Corey, and he is under age 24 and a full-time student.

Head of household status is (less/more) ______ favorable than the married filing jointly status, but (less/more) ______ favorable than the single filing status.

Less, more

Melina's daughter, Linda, is considered permanently and totally disabled. Linda is 30 years old and still lives with Melina. Which of the following statements is accurate regarding the age test for a qualifying child as it applies to Linda? Linda is deemed to meet the age test because she is permanently and totally disabled. Linda does NOT meet the age test because she is not under the age of 19. Linda does NOT meet the age test because she is not a full-time student.

Linda is deemed to meet the age test because she is permanently and totally disabled.

A ______-term capital gain is taxed at favorable rates compared to ordinary income, while a ______-term capital gain is taxed at ordinary income rates.

Long; short

Which of the following statements is INCORRECT when referring to capital gains and losses? Capital gains on assets that were held one year or less are taxed at ordinary income rates. Losses on personal use assets are fully deductible against ordinary income. Deductible capital losses that exceed capital gains are limited to $3,000 against ordinary income in one year. Capital gains on assets that were held more than one year are taxed at 0%, 15%, or 20%, depending on the taxpayer's taxable income for the year.

Losses on personal use assets are fully deductible against ordinary income.

Which filing status is allowed the highest standard deduction amount? Married filing jointly Married filing separately Head of household Single

Married filing jointly

Rank the filing statuses according to which is the most favorable for taxpayers. Married filing jointly Head of household Single

Married filing jointly Head of household Single

Which filing status is used if one spouse dies during the year and the surviving spouse does not remarry before the end of the year? Married filing jointly (or separately) Single Head of household Qualifying widow or widower

Married filing jointly (or separately)

Kayla and Ben were married in November of the current year. What will be their filing status for the current year? Married filing jointly (or separately) because they were married as of the end of the year Single because they were married for less than half of the year One spouse can file as head of household and the other will file single since they live together but have been married less than half the year Married filing separately because they have been married for less than half of the year

Married filing jointly (or separately) because they were married as of the end of the year

Which two filing statuses have the same standard deduction amount? Head of household and married filing separately Married filing separately and married filing jointly Qualifying widow/widower and single Married filing separately and single

Married filing separately and single

Which two filing statuses have the same standard deduction amount? Qualifying widow/widower and single Married filing separately and married filing jointly Head of household and married filing separately Married filing separately and single

Married filing separately and single

Which of the following expenses are classified as itemized deductions for tax purposes? (Check all that apply.) Regular commuting costs Mortgage interest expense Charitable contributions Property insurance Higher education expenses for bachelor's degree

Mortgage interest expense Charitable contributions

Which of the following criteria is necessary to qualify as a dependent of another taxpayer? (Check all that apply.) Must NOT file a joint return unless there is no tax liability on the couple's return and no tax liability on either return if they filed separately correct Must be considered either a qualifying child or a qualifying relative correct Must be considered both a qualifying child and a qualifying relative Must NOT be required to file a tax return of his own Must be a citizen of the U.S. or a resident of the U.S., Canada, or Mexico

Must NOT file a joint return unless there is no tax liability on the couple's return and no tax liability on either return if they filed separately Must be considered either a qualifying child or a qualifying relative Must be a citizen of the U.S. or a resident of the U.S., Canada, or Mexico

Which of the following criteria is NOT necessary to qualify as a dependent of another taxpayer? Must NOT file a joint return unless there is no tax liability on the couple's tax return Must be unmarried for at least a portion of the year Must be considered either a qualifying child or a qualifying relative Must be a citizen of the U.S. or a resident of the U.S., Canada, or Mexico

Must be unmarried for at least a portion of the year

Which of the following individuals would meet the relationship test for being a qualifying child of the taxpayer? (Check all that apply.) Niece (younger than the taxpayer) Father Child Brother (younger than the taxpayer) Grandchild Cousin (younger than the taxpayer)

Niece (younger than the taxpayer) Child Brother (younger than the taxpayer) Grandchild

Income that is taxed in the current year according to the tax rate schedule is referred to as Blank______ income. tax-exempt tax-deferred ordinary long-term capital gains

Ordinary

If an individual could be a qualifying child for either her parent or her grandparent, the ______ (parent/grandparent) is entitled to claim the child as a dependent.

Parent

Which of the following requirements are necessary to qualify for head of household status? Have lived with a qualifying person in the taxpayer's home for more than half the year Pay more than half the costs of keeping up a home for the year Be unmarried (or considered unmarried under the abandoned spouse provisions) at the end of the year Be a qualifying widow or widower

Pay more than half the costs of keeping up a home for the year Be unmarried (or considered unmarried under the abandoned spouse provisions) at the end of the year

Which one of the following items is NOT a deduction FOR AGI? One-half of self-employment taxes Self employment expenses Rental property expenses Real estate taxes on personal residence

Real estate taxes on personal residence

Sheila and Joe Wells are married with one dependent child. During 2023, they have gross income of $159,800, deductions for AGI of $5,500, itemized deductions of $29,100 and a dependent tax credit of $2,000. The Wells' had $22,000 withheld by their employer for federal income tax. They have a tax _______ (due/refund) of $ ______.

Refund, 5841

Which of the following items does NOT constitute support when determining who provided the support for a child of the taxpayer who is a full-time student? Recreational activities and camps Scholarships Food and clothing Allowances and gifts

Scholarships

In addition to the individual income tax, individuals may be required to pay other taxes. Owners of unincorporated businesses may have to pay _____ - ______ tax. (Enter only one word per blank.)

Self employment

Ruida divorced on October 31 of the current year. He does NOT have any dependents. Which filing status should Ruida use for the current year? Qualifying widow Head of household Married filing separately Single

Single

Which filing status is allowed the lowest standard deduction amount? Single Qualifying widow or widower Married filing jointly Head of household

Single

Which of the following choices are filing statuses that may be used by a taxpayer? (Check all that apply.) Single Divorced Head of household Unmarried but filing jointly Single parent Married filing jointly

Single Head of household Married filing jointly

The U.S. tax laws are based on the all-inclusive concept where gross income includes all realized income from "whatever ______ ______"

Source derived

Which of the following individuals would meet the relationship test for being a qualifying child of the taxpayer? (Check all that apply.) Grandmother Cousin (younger than the taxpayer) Stepson Aunt Nephew (younger than the taxpayer) Half-sister (younger than the taxpayer)

Stepson Nephew (younger than the taxpayer) Half-sister (younger than the taxpayer)

In order to meet the ______ test, the taxpayer must pay more than half of the living expenses for the qualifying relative.

Support

Which of the choices below are the tests that must be met to qualify as a qualifying relative? (Check all that apply.) Age Support Relationship Occupation Gross income

Support Relationship Gross income

The three tests that must be met to qualify as a qualifying relative are: _____ , ______ , and ______. (Each blank may contain more than one word.)

Support, relationship, gross income

Match the type or character of income to its definition Tax-exempt Tax-deferred Ordinary Capital

Tax-exempt: Income realized during the year that is excluded from gross income and never taxed. Tax-deferred: Income realized during the year that is not included in gross income until a later year Ordinary: Income included in gross income in the current year and taxed at the ordinary rates per the tax rate schedules Capital: Gains (or losses) on investment or personal use assets that may be taxed at favorable rates

Which of the following statements are correct concerning the married filing separately (MFS) filing status? (Check all that apply.) Tax-related items for MFS taxpayers (i.e. tax rate schedules, standard deduction amounts), are half the amounts for married filing jointly taxpayers. The MFS status may be useful when one spouse does NOT want to be liable for the tax liability of the other spouse. The MFS status is the only status that may be used when a spouse dies during the tax year. MFS taxpayers can capitalize on deductions when one spouse itemizes deductions, while the other spouse uses the standard deduction.

Tax-related items for MFS taxpayers (i.e. tax rate schedules, standard deduction amounts), are half the amounts for married filing jointly taxpayers. The MFS status may be useful when one spouse does NOT want to be liable for the tax liability of the other spouse.

Which of the following choices describe tax deductions? (Choose all that apply.) Tax deductions reduce an individual's tax liability dollar for dollar. Taxpayers are NOT allowed to deduct anything unless a specific tax provision allows them to do so. Tax deductions are a matter of legislative grace. Tax deductions, like income, follow the all-inclusive concept.

Taxpayers are NOT allowed to deduct anything unless a specific tax provision allows them to do so. Tax deductions are a matter of legislative grace.

Yolanda is your client. With her current level of taxable income, she is paying tax at a 24% marginal rate. She received $2,000 in qualified dividends this year. What rate of tax do you expect that Yolanda will pay on her dividends? The dividends are considered ordinary income, so they will be taxed at Yolanda's marginal rate of 24%. The qualified dividends are taxed at a favorable rate. Since Yolanda is in the 24% bracket, the dividends will be taxed at 15%. Qualified dividends are tax deferred income and will be taxed in a future year when the underlying investment is sold. Qualified dividends are tax-exempt income, so the dividends will not be taxed now or in the future.

The qualified dividends are taxed at a favorable rate. Since Yolanda is in the 24% bracket, the dividends will be taxed at 15%.

Select the statement you believe is INCORRECT when comparing the rules for determining who qualifies as a dependent as a qualifying child and who qualifies as a dependent as a qualifying relative. Taxpayers need NOT provide more than half a qualifying child's support, but they must provide more than half the support of a qualifying relative. Qualifying relatives are subject to a gross income restriction while qualifying children are not. The relationship requirement is more broadly defined for qualifying children than for qualifying relatives. Qualifying children are subject to age restrictions while qualifying relatives are not.

The relationship requirement is more broadly defined for qualifying children than for qualifying relatives.

Which of the following statements are true regarding the qualifying widow or widower filing status? (Check all that apply.) The status may be used for up to two years after the year the other spouse died. The surviving spouse can NOT use this status if he or she has dependents. The status is used in the year that one spouse died. The surviving spouse must NOT have remarried during the year. The surviving spouse must have dependents.

The status may be used for up to two years after the year the other spouse died. The surviving spouse must NOT have remarried during the year. The surviving spouse must have dependents.

Which of the following are requirements that must be met to qualify as an abandoned spouse? (Check all that apply.) The taxpayer's home is the principal residence of a dependent child for over half the year. The taxpayer pays more than half the costs of maintaining his or her home for the entire year. The taxpayer is still married at the end of the year. The taxpayer must have lived apart from the other spouse for the entire year.

The taxpayer's home is the principal residence of a dependent child for over half the year. The taxpayer pays more than half the costs of maintaining his or her home for the entire year. The taxpayer is still married at the end of the year.

The gross income test requires that a qualifying relative's gross income for the year must be less than $4,700 for tax year 2023.

True

True or false: For AGI deductions are preferable to from AGI deductions.

True

In a situation where the parents are divorced and the child resides with both parents for the same amount of time during the year, the parent with the Blank______ should claim the child as his or her dependent. lowest AGI highest taxable income lowest taxable income highest AGI

highest AGI

An individual that is unrelated to the taxpayer may meet the relationship test for a qualifying relative if he or she: lives with the taxpayer for the entire year. marries the taxpayer during the year. lives with the taxpayer for less than the entire year, but more than half the year.

lives with the taxpayer for the entire year.

In order to meet the requirements of the residence test for a qualifying child, the individual must live with the taxpayer for: at least one-third of the year the entire year longer than he has resided with anyone else during the year more than half the year

more than half the year