Ch2 Compiling Taxpayer Information
Which of the following is not a common error on Form W-7? a. Name mismatch b. No date of entry c. Unsigned passports d. Incomplete acceptance agent information
Incomplete acceptance agent information
Generally, California individual tax returns are due for taxpayers traveling abroad on which of the following dates (if the due date does not fall on a Saturday, Sunday, or legal holiday)? a. April 15 b. March 15 c. September 15 d. June 15
June 15
Maritza is receiving a refund and designated $3 to the Presidential Election Campaign Fund. How will the $3 affect her refund? a.Maritza cannot contribute to the Presidential Election Campaign Fund. b.Maritza will need to send a separate check to contribute to the Presidential Election Campaign Fund. c.Maritza's donation will not affect either the refund or amount owed on the tax return. d.Maritza's refund will be reduced by $3.
Maritza's donation will not affect either the refund or amount owed on the tax return.
Mark purchases most of his supplies for his tax office online from out-of-state retailers. Which of the following would best describe what Mark will need to do? a. Mark will need to pay the Use Tax if he did not pay sales tax at the time of purchase. b. Mark does not need to pay the Use Tax, since he purchased the products over the phone. c. Mark will be charged a penalty for not paying sales tax at the time of purchase. d. Mark will need to return any unused supplies and then repurchase them to avoid paying the Use Tax.
Mark will need to pay the Use Tax if he did not pay sales tax at the time of purchase.
Which of the following is not a federal filing status? a.Married filing separate (MFS) b.Head of household (HOH) c.Single (S) d. Married/RDP filing jointly e.Married filing jointly (MFJ)
Married/RDP filing jointly
Which of the following is not true about the signature section? a.Only the taxpayer is required to sign when filing married/RDP jointly. b.An unsigned tax return will be assessed a penalty c.The paid preparer must sign the return in the appropriate box. d.The paid preparer would enter his or her PTIN, business name, business address, FEIN, and business phone number.
Only the taxpayer is required to sign when filing married/RDP jointly.
Which of the required supporting documents for ITIN applications is a standalone document? a. Passport b. U.S. Citizenship and Immigration Services (USCIS) photo identification c. National identification card d. Foreign driver's license e. Foreign voter's registration card
Passport
Prior to calculating state income, which of the following is calculated? a.Tax b.Personal exemption c.Filing status d. income
Personal exemption
If the dependent is a minor, the ITIN documentation must establish the relationship between the dependent and the representative signing the application on the dependent's behalf. All the following documents could be included, except? a.Photocopied medical records (for children under six) b.School records (for school-age children) c.Other court-appointed papers showing legal guardianship d.Adoption papers
Photocopied medical records (for children under six)
Paid preparers would enter their business information and signature in the Paid Preparer Use Only section. Which of the following is not included? a. Preparer's name b. Preparer's signature c.Preparer's EIN d. Preparer's PTIN E.Prepare's ITIN
Prepare's ITIN
When entering the taxpayer's personal information on the appropriate section of the California tax form, which of the following is not included? a. Taxpayer's name b. Preparer Tax identification number (PTIN) c. Date of birth (DOB) d. Social security number (SSN)
Preparer Tax identification number (PTIN)
Which scenario is not a reason for filing a California extension? a.The filing deadline is April 15, the same as the federal. Taxpayers residing or traveling abroad have until June 15 to file. b.Interest will accrue on any balance from April 15 until the payment is completed. c.Residents traveling to another state are considered to be abroad. d.If the taxpayer cannot file his or her California tax return by April 15, he or she will be allowed an automatic six-month extension without filing a written request.
Residents traveling to another state are considered to be abroad.
Which of the following reports self-employment tax? a. Schedule 2 b. Schedule C c. Schedule 3 d. Schedule E
Schedule 2
Omar interviewed Fernando to prepare his accurate tax return. Fernando told Omar his name was Fernando Cruz. On Fernando's Social Security card, the name appears as Fernando Dela-Cruz. Which of the following government agencies does the tax return need to match? a.Internal Revenue Service (IRS) b. Office of Professional Responsibility (OPR) c.Secretary of State (SOS) d.Social Security Administration (SSA)
Social Security Administration (SSA)
Which of the following is not reported on Form 1040, Schedule 1, Part II? a. Standard deduction b. Taxable refunds c. Educator expenses d. Student loan interest
Standard deduction
When assembling the tax return for the client, which is the best way to put the return together? a. Just staple everything together as it comes out of the printer. b. Use the sequence number that is found on the top right hand of all other forms except the 1040. c. Mail the state return with your federal return. d. Make sure the supporting documents are added at the end in sequential order.
Use the sequence number that is found on the top right hand of all other forms except the 1040.
Which of the following is not a common error found when processing an application for an ITIN? a. Name does not match the name on the tax return b. Date of entry is not entered c. Passport is not signed d. W-2s match the name on the application
W-2s match the name on the application
When collecting information about dependents claimed on a tax return, what is the basic information that is needed to be asked? a. What is the dependent's nickname? b. What is the dependent's relationship to the taxpayer? c. What is the dependent's phone number? d. What is the dependent's school address?
What is the dependent's relationship to the taxpayer?
Is it required to enter the tax preparer's name and PTIN on the tax return? a.Only if the taxpayer chooses to include it b.Yes, if someone other than the taxpayer completed the tax return. c.No, it is not required d.It depends in what state the return is prepare
Yes, if someone other than the taxpayer completed the tax return.
Which of the following is not a method used to file a tax return? [email protected] b. Electronic filing (e-file) c. Private delivery service (FedEx, UPS, etc.) d.United States Postal Service
Samantha's withholding did not cover the balance due. What amount would make Samantha pay a penalty and interest charge? a. $500 b. $900 c. $1,000 d. $0
$1,000
What is the amount on form 540, line 11? $0 $114 $529 $353
$529
What is the amount on form 540, line 32? a.$529 b.$353 c.$114 d.$0
$529
The taxpayer is a resident alien of the United States for tax purposes if he/she meets which of the following tests? 1. The "green card" test 2. The "Quarterly Test" 3. The "substantial presence test" a. 1 Only b. 2 & 3 Only c. 3 Only d. 1 & 3
1 & 3
Luis and Tiffany got married and moved to California and want to know how to file their tax return. Luis works for the local supermarket and Tiffany works for the local university. Based on the segment content, which of the following questions must be asked to determine how to file their tax return? 1. What is their last name(s)? 2. How long have they lived in California? 3. Where are their income statements (for example, W-2, 1099-NEC, etc.(? 4. Do they have a nonexpired government-issued photo identification to prove that they are who they say they are? 5. Do they have any dependents? 6. Will they be claiming moving expenses? a. 1, 2, 3, 4, and 5 b. 2, 3, 4, 5, and 6 c. 1, 3, and 5 d.2,4, and 6
1, 2, 3, 4, and 5
Which of the following does not describe a California resident? a.Domiciled in California but lives outside California for a temporary or transitory purpose. b.A nonresident can choose to be treated as resident for the entire year. c.An individual domiciled in California who lives outside California for a temporary or transitory purpose remains a resident. d.Live in California for other than a temporary or transitory purpose.
A nonresident can choose to be treated as resident for the entire year.
Which of the following is not reported on the California return? a.SSN, ITIN, or an ATIN as it appears on the card b.Address of grandfather c. Date of birth d.Taxpayer's address
Address of grandfather
On Form 1040, Schedule 1, lines 11-26, which of the following happens? a.Report their MAGI. b.Report their AGI. c. Add more income. d.Adjust the taxpayer income.
Adjust the taxpayer income.
Esther gave permission to Susan to check the box as her Third-party Designee. When will the authorization expire? a. April 15, 2022 b. April 15, 2023 c. April 15, 2024 d. April 15, 2025
April 15, 2023
Which of the following is true about California Filing Status? a. California conforms with the federal filing status. b. California taxpayers can always file their taxes as married filing joint for federal and married filing separately for California. c. California must always use their federal filing status. d. California taxpayers can file their taxes as Married/RDP filing jointly.
California taxpayers can file their taxes as Married/RDP filing jointly.
Which of the following is true about California Filing Status? a. California conforms with the federal filing status. b. California taxpayers can always file their taxes as married filing joint for federal and married filing separately for California. c. California taxpayers can file their taxes as Married/RDP filing jointly. d. California must always use their federal filing status.
California taxpayers can file their taxes as Married/RDP filing jointly.
Which of the following is true about the "use tax"? a.California taxpayers pay "use tax" only for items purchased online. b.California taxpayers who purchased items through the internet, over the phone, and by mail from out-of-state retailers, and are not charged sales or use tax, may have to pay sales or use tax. c.California taxpayers only pay a portion of the "use tax" for out-of-state purchases. d.California taxpayers do not pay "use tax" for out-of-state purchases
California taxpayers who purchased items through the internet, over the phone, and by mail from out-of-state retailers, and are not charged sales or use tax, may have to pay sales or use tax.
Which of the following is not reported in the "Paid Preparer Use Only" section? a.Business name, address, and phone number b. EIN c. PTIN d. EFIN
EFIN
Which of the following is not reported on Form 540, line 31? a.FTB 3800 b.FTB 3803 c.EIC Tax Table d. Tax Table
EIC Tax Table
Which of the following is not reported on Form 1040, Schedule 2, Part II? a. Additional Medicare Tax b. Net Investment Income Tax c. Early withdrawal of an IRA d. Unreported Social Security and Medicare tax
Early withdrawal of an IRA
Which of the following is not a section on Form 1040? a. Filing Status b. Dependents c. Income d. Educator Expense
Educator Expense
Which of the following is reported on Form 1040, Schedule 1, Part II? a. Moving expenses for all taxpayers b. Lifetime Learning credit c. Educator expenses d. Social Security benefits
Educator expenses
Which method is not used to file a tax return? a. Electronic filing b. Private delivery service c. United States Post Office d. Fax the return to the local IRS Office
Fax the return to the local IRS Office
The individual tax return is due on which of the following dates (Form 1040 and 1040NR)? a. First deadline is April 15, 2022, and the extended deadline is October 2, 2022. b. First deadline is March 16, 2022, and the extended deadline is September 15, 2022. c. First deadline is April 15, 2022, and the extended deadline is October 16, 2022. d.First deadline is April 15, 2022, and the extended deadline is October 17, 2022.
First deadline is April 15, 2022, and the extended deadline is October 17, 2022.
When are S-Corporation tax returns due (Form 1120-S)? a. First deadline is April 15, 2022, and the extended deadline is October 4, 2022. b. First deadline is March 15, 2022, and the extended deadline is September 15, 2022. c.First deadline is April 15, 2022, and the extended deadline is October 17, 2022. d. First deadline is April 15, 2022, and the extended deadline is October 17, 2022.
First deadline is March 15, 2022, and the extended deadline is September 15, 2022.
When are partnership returns due (Form 1065)? a.First deadline is March 15, 2022, and the extended deadline is September 15, 2022. b.First deadline is April 15, 2022, and the extended deadline is October 17, 2022. c.First deadline is April 15, 2022, and the extended deadline is October 16, 2022 d.First deadline is April 15, 2022, and the extended deadline is October 2, 2022.
First deadline is March 15, 2022, and the extended deadline is September 15, 2022.
Which of the following is not reported on Schedule 3? a. Nonrefundable credits b. Federal tax payments c. Refundable credits d. First time homebuyer credit
First time homebuyer credit
Which of the following federal forms does not require Form 1040 to be attached to the state tax return? a. Schedule A b.Form 2441 c. Form 2106 d. Schedule B e.Schedule EITC
Form 2106
Andrew and Lori are married and filing a joint return. Lori's income is $105,369 and Andrew's income is $97,123. Which state form will they use to report their income? a. Form 540 -NR b. Form 540 2EZ c. Form 540 d. Form 1040
Form 540
What is the filing status? a.MFJ b.HoH c.MFS d.Single
HOH
Which of the following does not need to be entered in the "Paid Preparer Use Only" section? a. Preparer Tax Identification Number b. Business Name c. Business Address d. IP PIN
IP PIN
Which of the following government agencies issues the ITIN? a.U.S. Treasury b. FTB c. Secretary of State d. IRS
IRS
When completing Form 540, which of the following is not entered as the taxpayer's information? 1.First and last name as found on the SSN or ITIN 2.Address of the taxpayer 3.Date of birth 4.Tax preparer's PTIN a.1 &/Y 2 b.4 c.1, 2, 3, &/Y 4 d.1, 2 &/Y 3
4
Which of the following factors does not need to be considered when determining an individual's residency status? 1.Days spent in California versus outside of California 2.Location of spouse and children 3.Location of principal residence 4.Which state issued taxpayer's driver's license 5.For which state is the taxpayer paying "use tax" a. 1 b. 5 c. 2 &/Y 4 d. 1, 3 &/Y 5
5
Which form is used to adjust the California tax return? a.Schedule B b.Schedule k c.540 Schedule CA d.Schedule A
540 Schedule CA
Which of the following do you need from the taxpayer to prepare their return? a. All income documents b. Determine taxpayer filing status c. Correct address for mailing the tax return d. Mail the payment due on October 15th
All income documents
Preparers must determine how a taxpayer must file his/her tax return based on which of the following? a. If taxpayer is a resident alien b. If taxpayer is a nonresident alien c. If taxpayer is a dual-status alien d. All the options are correct
All the options are correct
Which of the following is not found in the "Special Credit" section on the California return? a. Nonrefundable renter's credit b. Nonrefundable child and dependent care expenses c. Alternative minimum tax d. Additional special credits
Alternative minimum tax
Which of the following is not true about assembling the federal tax return? a. When mailing the return, attach a copy of Form(s) W-2, W-2G, and/or 1099-R to page 1 of the return. b. If the taxpayer must attach supporting statements, arrange them in the same order as the schedules and attach them at the end of the return. c.Make sure that the attachment sequence order that is shown in the upper right-hand corner is in numerical order starting with Form 1040. d.Always attach a copy of the state tax return to the federal tax return.
Always attach a copy of the state tax return to the federal tax return.
Which of the following is not true about an ITIN? a. An ITIN is a nine-digit number beginning with the number 9. b.An ITIN is a tax processing number. c. An ITIN is issued by the IRS, for certain resident and nonresident aliens, their spouses, and their dependents. d. An ITIN can be used for other purposes than filing a tax return.
An ITIN can be used for other purposes than filing a tax return.
The taxpayer (or spouse) who does not have a SSN should do which of the following? a. Apply for an SSN (if they qualify) or an ITIN b. Apply for an ITIN c .Do not file a tax return d. Leave the space blank
Apply for an SSN (if they qualify) or an ITIN
For tax year 2021 when is the individual tax return due? a. March 15, 2022 b. February 12, 2022 c. October 17, 2022 d. April 15, 2022
April 15, 2022
¿Cuál de las siguientes afirmaciones no es cierta cuando se solicita un ITIN? a.Attach Form W-7 or W-7(SP) to a current year federal tax return. b.The IRS will send you an acknowledgement notification when they process the ITIN. c.Use Form W-7 or W-7(SP) to apply for an ITIN d.The ITIN application must be sent to the Austin Service Center.
Attach Form W-7 or W-7(SP) to a current year federal tax return.
Which of the following best describes how California law begins to tax income? a. By starting with the federal adjusted gross income. b. By starting with the federal income. c. By starting with the federal refundable credits. d. By starting with the federal filing status.
By starting with the federal income.
Which of the following is not true about the different ways to pay the tax owed? a. California does not offer installment agreement b. Western Union - pay online, by phone, or in person at a Western Union office. Fees apply. c.Mail a check or money order to the FTB. d.Pay online www.ftb.ca.gov with a credit card (fees may apply).
California does not offer installment agreement
When gathering information for the California return, which of the following is not asked in the taxpayer information section? a. First and last name of the taxpayer. b. Dependent date of birth. c. Prior name used for the taxpayer and/or spouse/RDP d. Taxpayer and spouse/RDP date of birth.
Dependent date of birth.
Which of the following individuals does not need to sign the federal tax return? a.Dependent on the return b.Paid tax preparer c.Taxpayer d.Spouse if filing a joint return
Dependent on the return
Which of the following is not reported in the Third-Party Designee section? a Designee's PIN b. Designee's PTIN c. Designee's name d.Designee's phone number
Designee's PTIN
Which scenario best describes how California residents are taxed on their income? a. Josue is a resident of California and worked in Arizona and California. Josue will pay tax only on his California income. b. Susan is a resident of California and is receiving pension income from New Mexico. Susan will pay California income tax on her pension from New Mexico. c. Esperanza is an Arizona resident and only has income from Arizona. California will tax Esperanza's Arizona income. d. Oliver is active military and a California resident. He has been stationed in Florida. Oliver will pay tax to Florida and California on his military income.
Susan is a resident of California and is receiving pension income from New Mexico. Susan will pay California income tax on her pension from New Mexico.
Whose name appears under "Third party designee"? a.Spouse b.Nobody c.Taxpayer. d,Tax preparer
Tax preparer
In which of the following situations should a copy of the completed federal Schedule A be included with the California return? a. Taxpayer itemized deductions on the federal return. b. Taxpayer itemized deductions on the California return. c. Taxpayer did not itemize on federal tax return but will itemize on the California return. d. Taxpayer itemized on federal tax return but will not itemize on the California tax return.
Taxpayer itemized deductions on the federal return.
Which of the following individuals do not need an ITIN to file a tax return? a.Taxpayer who has an SSN b.Nonresident alien c.Alien dependent not eligible for an SSN d.taxpayer who does not qualify for an SSN
Taxpayer who has an SSN
Charles wants to make a voluntary contribution to the California Sea Otter Fund. How will the contribution affect his refund? a. The contribution will lower his refund. b. The contribution will lower the amount owed. c. The contribution will not affect his refund. d. The contribution will not affect the balance due.
The contribution will lower his refund.
What is the added benefit for using the Form 1040-SR? a. Fonts size is automatically smaller. b. The higher standard deduction is automatically added. c. Paid preparers do not need to sign the return. d. There are 4 pages instead of 2 pages for Form 1040-SR.
The higher standard deduction is automatically added.
Which of the following is not true about the state tax refund? a.The refund can be deposited into two separate accounts b. State refunds are always sent by mail. c. The refund can be directly deposited into any account. d. The refund is automatically rolled over to the following year.
The refund is automatically rolled over to the following year.
To confirm the taxpayer's identity, which of the following does not need to be collected? a. Their expired government-issued photo identification. b. Some documentation that confirms the taxpayer's current address. c. The tax preparer should verify the Social Security number(s) for everyone on the tax return. d. Date of birth.
Their expired government-issued photo identification.
When making estimated payments, which of the following must a taxpayer and spouse/RDP determine when filing separate returns for California? a.They do not have to determine anything; the taxpayer must claim all the estimated payments in his/her California tax return. b.They do not have to determine anything; the spouse/RDP must claim all the estimated payments in his/her California tax return. c.They must determine which of them will claim the estimated payments on the separately filed returns. d.They must determine which of them will claim a higher percentage of their estimated payments.
They must determine which of them will claim the estimated payments on the separately filed returns.
