2022 Basic Exam (Retest)

Lewis, age 26, and Oneida, age 25, are married and will file a joint return. • They cannot be claimed as dependents by another taxpayer. • Lewis and Oneida have no children or other dependents. • Both work and neither are full-time students. Lewis earned wages of $15,400 and Oneida earned wages of $5,600. • Lewis and Oneida are U.S. citizens and have valid Social Security numbers. • Lewis and Oneida have investment income of $5,000. The maximum amount of investment income that Lewis and Oneida can have to qualify for the Earned Income Tax Credit is $ ____________.

$3000

Jane's husband moved out of their home in February of the tax year and has not returned. Jane provides all the cost of keeping up the home for herself and her two dependent children. Jane refuses to file a joint return with her husband. What filing status should she use?

Head of Household

Cindy's husband died on August 19 of the tax year. Cindy has no dependents and has not remarried. She should file as:

Married Filing Jointly

Ryan and Julie were married on December 29 of the tax year. They should file as:

Married Filling Jointly

Becky and Frank were divorced on December 29 of the tax year. They have no children or other dependents and have not remarried. Their filing status should be:

Single

Individuals who are not required to file a tax return should file a return if they can claim the earned income credit. A. True B. False

A. True

Jeff, age 68 and Claire, age 63 elect to file Married Filing Jointly. Neither taxpayer is blind. • Jeff is retired. He received Social Security benefits and a pension. • Jeff and Claire's daughter Shelby, age 19, is a full-time college student in her second year of study. She is pursuing a degree in foreign studies and does not have a felony drug conviction. She received a Form 1098-T for 2022. Box 7 was not checked on her Form 1098-T for the previous tax year. • Shelby spent the summer at home with her parents but lived in an apartment near campus during the school year. • Shelby received a scholarship and the terms require that it be used to pay tuition. Jeff and Claire paid the cost of Shelby's tuition and course-related books in 2022 not covered by scholarship. They paid $120 for a parking sticker, $5,500 for a meal plan, $750 for textbooks purchased at the college bookstore, and $100 for access to an online textbook. • Jeff and Claire paid more than half the cost of maintaining a home and support for Shelby. • Jeff and Claire do not have enough deductions to itemize on their federal tax return. • Jeff, Claire, and Shelby are U.S. citizens and have valid Social Security numbers. They all lived in the United States for the entire year. • If Jeff and Claire receive a refund, they would like to deposit it into their checking account. Documents from Baldwin Bank show that the routing number is 111000025. Their checking account number is 11337890. The Pickens's total amount of federal income tax withholding for 2022 is $_____________.

$5,832

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. A. True B False

A. True

Clay and Marian are married and will file a joint return. • Marian is a U.S. citizen with a valid Social Security number. Clay is a resident alien with an Individual Taxpayer Identification Number (ITIN). • Marian worked in 2022 and earned wages of $32,000. Clay worked part-time and earned wages of $18,000. • The Washingtons have two children: Erin, age 12 and Jenny, age 18. • The Washingtons provided the total support for their two children, who lived with them in the U.S. all year. Erin and Jenny are U.S. citizens and have valid Social Security numbers. Jenny qualifies the Washingtons for the Credit for Other Dependents. a. True b. False

A. True

Sebastian and Ashley Miller are married and always file Married Filing Jointly. • Sebastian earned $32,000 in wages and Tina earned $24,000 in wages. • The Millers paid all the cost of keeping up a home and provided all the support for their two children, Laura and Timothy, who lived with them all year. • Laura is 14 years old and Timothy turned 17 in November 2022. • Sebastian and Tina did not have enough deductions to itemize, but contributed $1,500 in 2022 to their church, a qualified charitable organization. • Sebastian, Ashley, Laura, and Timothy are all U.S. citizens with valid Social Security numbers and lived in the U.S. the entire year. What amount can Sebastian and Ashley deduct as a charitable contribution? a. $0 b. $600 c. $1,200 d. $1,500

B. $600

A driver's license can be used to verify a taxpayer's Social Security number and correct name spelling. A. True B. False

B. False

Sebastian and Ashley Miller are married and always file Married Filing Jointly. • Sebastian earned $32,000 in wages and Tina earned $24,000 in wages. • The Millers paid all the cost of keeping up a home and provided all the support for their two children, Laura and Timothy, who lived with them all year. • Laura is 14 years old and Timothy turned 17 in November 2022. • Sebastian and Tina did not have enough deductions to itemize, but contributed $1,500 in 2022 to their church, a qualified charitable organization. • Sebastian, Ashley, Laura, and Timothy are all U.S. citizens with valid Social Security numbers and lived in the U.S. the entire year. The Millers do not qualify for the Child Tax Credit (CTC). a. True b. False

B. False

Taxpayers age 65 or older must use Form 1040-SR instead of Form 1040 to file their return. A. True B. False

B. False

Tom is 36 years old and has never been married. • Frank, age 13, is Tom's nephew who lived with him all year. Tom provided all of his support and provided over half the cost of keeping up the home. • Tom earned $44,000 in wages. • Tom is blind and cannot be claimed as a dependent by another taxpayer. • Tom and Frank are U.S. citizens, have valid Social Security numbers, and lived in the U.S. the entire year. Tom's most advantageous filing status for 2022 is Single. a. True b. False

B. False

Anne's husband died one year ago. Anne has not remarried during the current tax year, but she has a 18-year-old dependent son. Anne's filing status should be:

Qualifying Widow(er)

Jeff, age 68 and Claire, age 63 elect to file Married Filing Jointly. Neither taxpayer is blind. • Jeff is retired. He received Social Security benefits and a pension. • Jeff and Claire's daughter Shelby, age 19, is a full-time college student in her second year of study. She is pursuing a degree in foreign studies and does not have a felony drug conviction. She received a Form 1098-T for 2022. Box 7 was not checked on her Form 1098-T for the previous tax year. • Shelby spent the summer at home with her parents but lived in an apartment near campus during the school year. • Shelby received a scholarship and the terms require that it be used to pay tuition. Jeff and Claire paid the cost of Shelby's tuition and course-related books in 2022 not covered by scholarship. They paid $120 for a parking sticker, $5,500 for a meal plan, $750 for textbooks purchased at the college bookstore, and $100 for access to an online textbook. • Jeff and Claire paid more than half the cost of maintaining a home and support for Shelby. • Jeff and Claire do not have enough deductions to itemize on their federal tax return. • Jeff, Claire, and Shelby are U.S. citizens and have valid Social Security numbers. They all lived in the United States for the entire year. • If Jeff and Claire receive a refund, they would like to deposit it into their checking account. Documents from Baldwin Bank show that the routing number is 111000025. Their checking account number is 11337890. How much of Jeff's Social Security is taxable income? a. $0 b. $6,000 c. $10,200 d. $12,000

a. $0

Isabela is single and turned 72 years old on October 1, 2022. • Isabela worked as a librarian at the local library and earned wages of $7,500. Isabela also received Social Security benefits of $16,000. She received a taxable pension of $13,000. • She retired from her previous job on October 30, 2019. During her career she contributed pretax dollars to a qualified 401(k) retirement plan through her employer. • Isabela cannot be claimed as a dependent by another taxpayer. • Isabela is a U.S. citizen with a valid Social Security number. What credit(s) is Isabela eligible to claim? a. Credit for the Elderly or the Disabled b. Earned Income Tax Credit c. Both the Credit for the Elderly or the Disabled and the Earned Income Tax Credit d. Neither the Credit for the Elderly or the Disabled or the Earned Income Tax Credit

a. Credit for the Elderly or the Disabled

Monica is 31 years old and married to Mike. Mike passed away on February 2, 2021. Monica has not remarried. • Monica's eight-year-old daughter, Emma, lived with her the entire year. • Monica paid more than half the cost of keeping up a home and support for Emma. • Monica received a distribution from her traditional IRA in January to pay for living expenses. • Monica was a full-time high school teacher and earned $42,000 in wages. Monica purchased supplies including masks and hand sanitizer for her class out of her own pocket totaling $450. • Monica received a W-2G in the amount of $10,000 from the local casino. • Monica paid child and dependent care expenses for Emma while she worked. • Monica and Emma are U.S. citizens and have valid Social Security numbers. They lived in the United States for the entire year. • If Monica is entitled to a refund, she would like to deposit half into her checking account and half into her savings account. Documents from Adelphi Bank and Trust show that the routing number for both accounts is 111000025. Her savings account number is 224466880. Which of the following statements are true? a. Monica should file Single b. Monica should file Married Filing Jointly c. Monica should file Head of Household d. Monica should file Qualifying Surviving Spouse (QSS)

a. Monica should file Single

Jeff, age 68 and Claire, age 63 elect to file Married Filing Jointly. Neither taxpayer is blind. • Jeff is retired. He received Social Security benefits and a pension. • Jeff and Claire's daughter Shelby, age 19, is a full-time college student in her second year of study. She is pursuing a degree in foreign studies and does not have a felony drug conviction. She received a Form 1098-T for 2022. Box 7 was not checked on her Form 1098-T for the previous tax year. • Shelby spent the summer at home with her parents but lived in an apartment near campus during the school year. • Shelby received a scholarship and the terms require that it be used to pay tuition. Jeff and Claire paid the cost of Shelby's tuition and course-related books in 2022 not covered by scholarship. They paid $120 for a parking sticker, $5,500 for a meal plan, $750 for textbooks purchased at the college bookstore, and $100 for access to an online textbook. • Jeff and Claire paid more than half the cost of maintaining a home and support for Shelby. • Jeff and Claire do not have enough deductions to itemize on their federal tax return. • Jeff, Claire, and Shelby are U.S. citizens and have valid Social Security numbers. They all lived in the United States for the entire year. • If Jeff and Claire receive a refund, they would like to deposit it into their checking account. Documents from Baldwin Bank show that the routing number is 111000025. Their checking account number is 11337890. Shelby does not qualify Jeff and Claire to claim the Credit for Other Dependents. a. True b. False

a. True

Leon Martin is single and has never been married. • Leon earned wages of $23,000 during the first half of the year. Leon lost his job in July and received a total of $9,000 in unemployment compensation. • Leon is a barber and took a class at the community barber college to improve his barbering skills. He paid the cost of tuition and a course-related book. His qualified education expenses were $2,500. • Leon also paid student loan interest for the courses he previously took to earn his Bachelor's degree. For 2022 he paid student loan interest of $550. • Leon does not have any dependents. • Leon is a U.S. citizen with a valid Social Security number. Leon can deduct $550 of student loan interest as an adjustment to his income. a. True b. False

a. True

Leon Martin is single and has never been married. • Leon earned wages of $23,000 during the first half of the year. Leon lost his job in July and received a total of $9,000 in unemployment compensation. • Leon is a barber and took a class at the community barber college to improve his barbering skills. He paid the cost of tuition and a course-related book. His qualified education expenses were $2,500. • Leon also paid student loan interest for the courses he previously took to earn his Bachelor's degree. For 2022 he paid student loan interest of $550. • Leon does not have any dependents. • Leon is a U.S. citizen with a valid Social Security number. Leon is eligible to claim the Lifetime Learning Credit. a. True b. False

a. True

Lewis, age 26, and Oneida, age 25, are married and will file a joint return. • They cannot be claimed as dependents by another taxpayer. • Lewis and Oneida have no children or other dependents. • Both work and neither are full-time students. Lewis earned wages of $15,400 and Oneida earned wages of $5,600. • Lewis and Oneida are U.S. citizens and have valid Social Security numbers. • Lewis and Oneida have investment income of $5,000. Lewis and Oneida are eligible to claim the Earned Income Tax Credit (EITC) without a qualifying child. a. True b. False

a. True

Monica is 31 years old and married to Mike. Mike passed away on February 2, 2021. Monica has not remarried. • Monica's eight-year-old daughter, Emma, lived with her the entire year. • Monica paid more than half the cost of keeping up a home and support for Emma. • Monica received a distribution from her traditional IRA in January to pay for living expenses. • Monica was a full-time high school teacher and earned $42,000 in wages. Monica purchased supplies including masks and hand sanitizer for her class out of her own pocket totaling $450. • Monica received a W-2G in the amount of $10,000 from the local casino. • Monica paid child and dependent care expenses for Emma while she worked. • Monica and Emma are U.S. citizens and have valid Social Security numbers. They lived in the United States for the entire year. • If Monica is entitled to a refund, she would like to deposit half into her checking account and half into her savings account. Documents from Adelphi Bank and Trust show that the routing number for both accounts is 111000025. Her savings account number is 224466880. Monica can split her refund between her savings and checking accounts by completing Form 8888, Allocation of Refund (Including Savings Bonds Purchases). a. True b. False

a. True

Monica is 31 years old and married to Mike. Mike passed away on February 2, 2021. Monica has not remarried. • Monica's eight-year-old daughter, Emma, lived with her the entire year. • Monica paid more than half the cost of keeping up a home and support for Emma. • Monica received a distribution from her traditional IRA in January to pay for living expenses. • Monica was a full-time high school teacher and earned $42,000 in wages. Monica purchased supplies including masks and hand sanitizer for her class out of her own pocket totaling $450. • Monica received a W-2G in the amount of $10,000 from the local casino. • Monica paid child and dependent care expenses for Emma while she worked. • Monica and Emma are U.S. citizens and have valid Social Security numbers. They lived in the United States for the entire year. • If Monica is entitled to a refund, she would like to deposit half into her checking account and half into her savings account. Documents from Adelphi Bank and Trust show that the routing number for both accounts is 111000025. Her savings account number is 224466880. Monica is eligible to claim the Child Tax Credit. a. True b. False

a. True

Morgan is single and 46 years old. • Morgan has two children. Leah, age 18, has a job and earned wages of $4,900. Dale, age 25 is totally and permanently disabled and received Social Security benefits of $4,500. Both children lived with her all year. • Morgan paid all the cost of keeping up the home and more than half the support for her children. • Morgan received disability pension benefits, but she has not reached the minimum retirement age of her employer's plan. • She does not have enough expenses to itemize for the 2022 tax year. • Morgan, Leah, and Dale are U.S. citizens and have valid Social Security numbers. They all lived in the United States for the entire year. • If she has any balance due or refund, she would like to use Adelphia Bank and Trust. Morgan provided a voided check. Both Leah and Dale qualify Morgan for the Earned Income Tax Credit (EITC). a. True b. False

a. True

Morgan is single and 46 years old. • Morgan has two children. Leah, age 18, has a job and earned wages of $4,900. Dale, age 25 is totally and permanently disabled and received Social Security benefits of $4,500. Both children lived with her all year. • Morgan paid all the cost of keeping up the home and more than half the support for her children. • Morgan received disability pension benefits, but she has not reached the minimum retirement age of her employer's plan. • She does not have enough expenses to itemize for the 2022 tax year. • Morgan, Leah, and Dale are U.S. citizens and have valid Social Security numbers. They all lived in the United States for the entire year. • If she has any balance due or refund, she would like to use Adelphia Bank and Trust. Morgan provided a voided check. Morgan can prevent having a balance due next year by using the Tax Withholding Estimator at IRS.gov and then adjust her withholding if necessary. a. True b. False

a. True

Morgan is single and 46 years old. • Morgan has two children. Leah, age 18, has a job and earned wages of $4,900. Dale, age 25 is totally and permanently disabled and received Social Security benefits of $4,500. Both children lived with her all year. • Morgan paid all the cost of keeping up the home and more than half the support for her children. • Morgan received disability pension benefits, but she has not reached the minimum retirement age of her employer's plan. • She does not have enough expenses to itemize for the 2022 tax year. • Morgan, Leah, and Dale are U.S. citizens and have valid Social Security numbers. They all lived in the United States for the entire year. • If she has any balance due or refund, she would like to use Adelphia Bank and Trust. Morgan provided a voided check. Morgan is eligible to claim Head of Household on her tax return. a. True b. False

a. True

Morgan is single and 46 years old. • Morgan has two children. Leah, age 18, has a job and earned wages of $4,900. Dale, age 25 is totally and permanently disabled and received Social Security benefits of $4,500. Both children lived with her all year. • Morgan paid all the cost of keeping up the home and more than half the support for her children. • Morgan received disability pension benefits, but she has not reached the minimum retirement age of her employer's plan. • She does not have enough expenses to itemize for the 2022 tax year. • Morgan, Leah, and Dale are U.S. citizens and have valid Social Security numbers. They all lived in the United States for the entire year. • If she has any balance due or refund, she would like to use Adelphia Bank and Trust. Morgan provided a voided check. Morgan's disability pension is reported as retirement income. a. True b. False

a. True

Jeff, age 68 and Claire, age 63 elect to file Married Filing Jointly. Neither taxpayer is blind. • Jeff is retired. He received Social Security benefits and a pension. • Jeff and Claire's daughter Shelby, age 19, is a full-time college student in her second year of study. She is pursuing a degree in foreign studies and does not have a felony drug conviction. She received a Form 1098-T for 2022. Box 7 was not checked on her Form 1098-T for the previous tax year. • Shelby spent the summer at home with her parents but lived in an apartment near campus during the school year. • Shelby received a scholarship and the terms require that it be used to pay tuition. Jeff and Claire paid the cost of Shelby's tuition and course-related books in 2022 not covered by scholarship. They paid $120 for a parking sticker, $5,500 for a meal plan, $750 for textbooks purchased at the college bookstore, and $100 for access to an online textbook. • Jeff and Claire paid more than half the cost of maintaining a home and support for Shelby. • Jeff and Claire do not have enough deductions to itemize on their federal tax return. • Jeff, Claire, and Shelby are U.S. citizens and have valid Social Security numbers. They all lived in the United States for the entire year. • If Jeff and Claire receive a refund, they would like to deposit it into their checking account. Documents from Baldwin Bank show that the routing number is 111000025. Their checking account number is 11337890. What is Jeff and Claire's total qualified education expenses used to calculate the American Opportunity Credit? a. $0 b. $2,120 c. $2,850 d. $9,500

b. $2,120

Monica is 31 years old and married to Mike. Mike passed away on February 2, 2021. Monica has not remarried. • Monica's eight-year-old daughter, Emma, lived with her the entire year. • Monica paid more than half the cost of keeping up a home and support for Emma. • Monica received a distribution from her traditional IRA in January to pay for living expenses. • Monica was a full-time high school teacher and earned $42,000 in wages. Monica purchased supplies including masks and hand sanitizer for her class out of her own pocket totaling $450. • Monica received a W-2G in the amount of $10,000 from the local casino. • Monica paid child and dependent care expenses for Emma while she worked. • Monica and Emma are U.S. citizens and have valid Social Security numbers. They lived in the United States for the entire year. • If Monica is entitled to a refund, she would like to deposit half into her checking account and half into her savings account. Documents from Adelphi Bank and Trust show that the routing number for both accounts is 111000025. Her savings account number is 224466880. What amount can Monica claim as an adjustment to income for the supplies she purchased out of pocket? a. $0 b. $250 c. $300 d. $450

b. $250

Clay and Marian are married and will file a joint return. • Marian is a U.S. citizen with a valid Social Security number. Clay is a resident alien with an Individual Taxpayer Identification Number (ITIN). • Marian worked in 2022 and earned wages of $32,000. Clay worked part-time and earned wages of $18,000. • The Washingtons have two children: Erin, age 12 and Jenny, age 18. • The Washingtons provided the total support for their two children, who lived with them in the U.S. all year. Erin and Jenny are U.S. citizens and have valid Social Security numbers. The Washingtons do not qualify for the Earned Income Credit because Clay has an ITIN. a. True b. False

b. False

Jeff, age 68 and Claire, age 63 elect to file Married Filing Jointly. Neither taxpayer is blind. • Jeff is retired. He received Social Security benefits and a pension. • Jeff and Claire's daughter Shelby, age 19, is a full-time college student in her second year of study. She is pursuing a degree in foreign studies and does not have a felony drug conviction. She received a Form 1098-T for 2022. Box 7 was not checked on her Form 1098-T for the previous tax year. • Shelby spent the summer at home with her parents but lived in an apartment near campus during the school year. • Shelby received a scholarship and the terms require that it be used to pay tuition. Jeff and Claire paid the cost of Shelby's tuition and course-related books in 2022 not covered by scholarship. They paid $120 for a parking sticker, $5,500 for a meal plan, $750 for textbooks purchased at the college bookstore, and $100 for access to an online textbook. • Jeff and Claire paid more than half the cost of maintaining a home and support for Shelby. • Jeff and Claire do not have enough deductions to itemize on their federal tax return. • Jeff, Claire, and Shelby are U.S. citizens and have valid Social Security numbers. They all lived in the United States for the entire year. • If Jeff and Claire receive a refund, they would like to deposit it into their checking account. Documents from Baldwin Bank show that the routing number is 111000025. Their checking account number is 11337890. Qualified dividends are not reported on Form 1099-DIV. a. True b. False

b. False

Monica is 31 years old and married to Mike. Mike passed away on February 2, 2021. Monica has not remarried. • Monica's eight-year-old daughter, Emma, lived with her the entire year. • Monica paid more than half the cost of keeping up a home and support for Emma. • Monica received a distribution from her traditional IRA in January to pay for living expenses. • Monica was a full-time high school teacher and earned $42,000 in wages. Monica purchased supplies including masks and hand sanitizer for her class out of her own pocket totaling $450. • Monica received a W-2G in the amount of $10,000 from the local casino. • Monica paid child and dependent care expenses for Emma while she worked. • Monica and Emma are U.S. citizens and have valid Social Security numbers. They lived in the United States for the entire year. • If Monica is entitled to a refund, she would like to deposit half into her checking account and half into her savings account. Documents from Adelphi Bank and Trust show that the routing number for both accounts is 111000025. Her savings account number is 224466880. Monica is subject to the additional 10% tax on early distributions. a. True b. False

b. False

Tom is 36 years old and has never been married. • Frank, age 13, is Tom's nephew who lived with him all year. Tom provided all of his support and provided over half the cost of keeping up the home. • Tom earned $44,000 in wages. • Tom is blind and cannot be claimed as a dependent by another taxpayer. • Tom and Frank are U.S. citizens, have valid Social Security numbers, and lived in the U.S. the entire year. Tom is blind and can claim a standard deduction amount of: a. $12,950 b. $19,400 c. $21,150 d. $25,900

c. $21,150

Morgan is single and 46 years old. • Morgan has two children. Leah, age 18, has a job and earned wages of $4,900. Dale, age 25 is totally and permanently disabled and received Social Security benefits of $4,500. Both children lived with her all year. • Morgan paid all the cost of keeping up the home and more than half the support for her children. • Morgan received disability pension benefits, but she has not reached the minimum retirement age of her employer's plan. • She does not have enough expenses to itemize for the 2022 tax year. • Morgan, Leah, and Dale are U.S. citizens and have valid Social Security numbers. They all lived in the United States for the entire year. • If she has any balance due or refund, she would like to use Adelphia Bank and Trust. Morgan provided a voided check. Who qualifies as Morgan's dependent? a. Leah b. Dale c. Both Dale and Leah d. Neither Dale nor Leah

c. Both Dale and Leah

Monica is 31 years old and married to Mike. Mike passed away on February 2, 2021. Monica has not remarried. • Monica's eight-year-old daughter, Emma, lived with her the entire year. • Monica paid more than half the cost of keeping up a home and support for Emma. • Monica received a distribution from her traditional IRA in January to pay for living expenses. • Monica was a full-time high school teacher and earned $42,000 in wages. Monica purchased supplies including masks and hand sanitizer for her class out of her own pocket totaling $450. • Monica received a W-2G in the amount of $10,000 from the local casino. • Monica paid child and dependent care expenses for Emma while she worked. • Monica and Emma are U.S. citizens and have valid Social Security numbers. They lived in the United States for the entire year. • If Monica is entitled to a refund, she would like to deposit half into her checking account and half into her savings account. Documents from Adelphi Bank and Trust show that the routing number for both accounts is 111000025. Her savings account number is 224466880. Monica must report _________ of her gambling winnings on her 2022 return. a. $0 b. $5,000 c. $7,000 d. $10,000

d. $10,000

Leon Martin is single and has never been married. • Leon earned wages of $23,000 during the first half of the year. Leon lost his job in July and received a total of $9,000 in unemployment compensation. • Leon is a barber and took a class at the community barber college to improve his barbering skills. He paid the cost of tuition and a course-related book. His qualified education expenses were $2,500. • Leon also paid student loan interest for the courses he previously took to earn his Bachelor's degree. For 2022 he paid student loan interest of $550. • Leon does not have any dependents. • Leon is a U.S. citizen with a valid Social Security number. What is the taxable amount of Leon's unemployment compensation? a. $0 b. $4,500 c. $9,000 d. $10,200

d. $10,200

Jeff, age 68 and Claire, age 63 elect to file Married Filing Jointly. Neither taxpayer is blind. • Jeff is retired. He received Social Security benefits and a pension. • Jeff and Claire's daughter Shelby, age 19, is a full-time college student in her second year of study. She is pursuing a degree in foreign studies and does not have a felony drug conviction. She received a Form 1098-T for 2022. Box 7 was not checked on her Form 1098-T for the previous tax year. • Shelby spent the summer at home with her parents but lived in an apartment near campus during the school year. • Shelby received a scholarship and the terms require that it be used to pay tuition. Jeff and Claire paid the cost of Shelby's tuition and course-related books in 2022 not covered by scholarship. They paid $120 for a parking sticker, $5,500 for a meal plan, $750 for textbooks purchased at the college bookstore, and $100 for access to an online textbook. • Jeff and Claire paid more than half the cost of maintaining a home and support for Shelby. • Jeff and Claire do not have enough deductions to itemize on their federal tax return. • Jeff, Claire, and Shelby are U.S. citizens and have valid Social Security numbers. They all lived in the United States for the entire year. • If Jeff and Claire receive a refund, they would like to deposit it into their checking account. Documents from Baldwin Bank show that the routing number is 111000025. Their checking account number is 11337890. Jeff and Claire's standard deduction is: a. $22,200 b. $25,900 c. $27,300 d. $28,700

d. $28,700

• Isabela is single and turned 72 years old on October 1, 2022. • Isabela worked as a librarian at the local library and earned wages of $7,500. Isabela also received Social Security benefits of $16,000. She received a taxable pension of $13,000. • She retired from her previous job on October 30, 2019. During her career she contributed pretax dollars to a qualified 401(k) retirement plan through her employer. • Isabela cannot be claimed as a dependent by another taxpayer. • Isabela is a U.S. citizen with a valid Social Security number. When must Isabela begin taking her required minimum distribution? a. April 1 of the calendar year following the year she reaches age 70 1/2. b. April 1 of the calendar year following the year she reaches age 72. c. April 1 of the calendar year following the year she retired. d. Never. Required minimum distributions only apply to Roth IRAs.

d. Never. Required minimum distributions only apply to Roth IRAs.