Module 8-14
What is the maximum amount the additional child tax credit allows taxpayers to claim per qualifying child?
$1000
What is the maximum amount the child tax credit allows taxpayers to claim per qualifying child?
$1000
What is the lowest percentage used to compute the tax credit for child and dependent care expenses?
$20.00
For the tax credit for child and dependent care expenses, what are the maximum qualifying expenses for a taxpayer with four qualifying dependents?
$6000
Which person cannot be claimed as a qualifying child?
A 5-year-old sister whose mother is claiming the credit with this child
Which option is available for a taxpayer receiving a refund?
Direct deposit in the taxpayer's bank account
Tax professional who electronically transmits tax returns to the IRS
ERO
Self-employment earnings are classified as what type of income?
Earned
What does ERO stand for?
Electronic Return Originator.
House painter who works for A-1 Painting
Employee
Pizza delivery driver for Number 1 Pizza
Employee
Restaurant critic for the newspaper
Employee
Who prepares Form W-2?
Employer
Which form reports payments made to independent contractors?
Form 1099-MISC
Which form reports salary payments made to employees?
Form W-2
Interest and dividends are classified as what type of income?
Investment
The process by which the taxpayer completes the tax return online and electronically submits it to the IRS
Online, Self-prepared
Used to authenticate an electronically transmitted tax return
PIN
What is used by IRS to authenticate an electronically transmitted return?
PIN
Which of the following individuals is eligible for the American Opportunity Credit?
Paulo, who is taking at least one-half of the normal course load required for the computer science associate's degree program, attending classes the entire school year
What does PIN stand for?
Personal Identification Number
Which tax form is used to calculate self-employment profit?
Schedule C
Which tax form is used to calculate the self-employment tax?
Schedule SE
Book reviewer for numerous magazines and newspapers who decides what books he is willing to review and when he will do the review
Self-employed
House painter who works for herself
Self-employed
Who completes Schedule SE?
Self-employed
A yoga instructor who gives classes in her home
Self-employed.
What is reduced by the earned income credit?
Tax
A taxpayer tax liability can be reduced to $0 and still receive a refund with which tax credit?
The refundable additional child tax credit
All taxpayers can make tax payments using a direct debit from their bank account.
false
Both the American Opportunity Credit and Lifetime Learning Credit can be claimed if a taxpayer has paid higher education expenses for an eligible student as long as they meet the general requirements.
false
Completing all of the forms and schedules needed to compute and report the tax is known as ERO.
false
For the earned income credit, there is no adjusted gross income limit.
false
If adjusted gross income is the same, the highest earned income credit is for a taxpayer without a qualifying child.
false
A convenience fee is charged for credit card payments made through a service provider.
true
A tax deduction reduces the income subject to tax.
true
A tax payment can be made by check
true
A tax refund can be received by direct deposit to a taxpayer's bank account.
true
If they meet the requirements, taxpayers may be able to claim both the child tax credit and the additional child tax credit.
true
The taxpayer can receive the earned income credit even if the taxpayer's tax is zero.
true
Are there circumstances when a taxpayer with an unemployed spouse can claim the tax credit for child and dependent care expenses?
yes
Can an unemployed taxpayer who is actively seeking work claim the tax credit for child and dependent care expenses?
yes
Which taxpayer can claim the earned income credit if all other requirements are met?
A taxpayer who earned $5,000 in self-employment income
Taxpayers maintain good records to
All of the above
Which of the following is an example of a double benefit?
Kristin, who claims the American Opportunity Credit for expenses paid with a Pell grant
Mateo takes part-time classes at a local university. He is now a junior in college. Which credit is he eligible for?
Lifetime Learning Credit
The highest earned income credit is for taxpayers with how many qualifying children?
Three or more
