HR Block Test

The Irs requires tax prepares subject to circular 230 to obtain written conflict of interest waivers from clients and to retain the waivers for:

36 months

a mountain-view lot bought for potential increase in value is an example of

A, Real, Investment-use property

The maxium IRA contribution for a taxpayer udner 50 is:

A. $6,000

The MACRS GDS recovery period for residental rental property is:

A. 27.5 years.

The MACRS GDS recovery period for residential rental property is:

A. 27.5 years.

All of the following statements about qualified tuition programs (also called Section 529 plans) are true Except:

A. A taxpayer's ability to contribute to these plans begins to phase out when their adjusted gross income reaches a specified threshold amount.

Generally, a farm corporation or partenership can only use what if the business has gross receipts of $25 million or less in three preceding tax years.

A. Cash Method of accounting

Sam purchased a new tractor and placed it in service on january 1, 2019. The tractor cost $45,000. What is the recovery period for the tractor (excluding Section 179)?

A. Five years

Which of the following forms is sent to an individual who purchased marketplace insurance?

A. Form 1095-A.

Tier 1 railroad retirement benefits are reported on:

A. Form RRB- 1099

In addition to rental real estate activities , which type of income is considered passive?

A. Income from a business in which taxpayer does not materially participate.

A property owner lives in one unity of a duplex and has a tennat renting the other unit. The owner will deduct 50% of which of the following expenses on Schedule E?

A. Landscaping.

Which of the following is included in support?

A. Life Insurance Premiums

Frivolous is :

A. Obviously improper or unlawful.

For tax Years 2018 and 2019, Sheila (53) was able to use the head of household filing status while she had temporary custody of her granddaugther, Mia. In February 2020, Mia moved back in with her biological parents. Next year, Shelia will file single, with no dependents. Although Sheila Received a refund for 2019, she is concerned that she will owe a large balance due on her 2020 return, since her situation has changed. As Sheila's tax preparer, what advic would you offer?

A. Suggest she complete Form W-4 so her employer can withold the correct amount of income tax from her pay for the remainder of the year.

Which of the following best explains the limiation to deduct prepaid farm supply expenses?

A. The limation does not apply if the expense is greater than 50% of all other deductible farm expenses due to a change in buisnesss operations for an unusal circumstances.

a taxpayer who is required to pay all of the mortage payments, for a jointly- owned home , if it otherwise qualifies as alimony, may deduct half of the total payments as alimony?

A. True

Which of the following is the only requirement listed that is the same for the child Tax Credit and Other Dependent Credit?

A. U.S, Citizien, National, or Resident.

A property owner lives in one unit of a duplex and has a tenant renting the other unit. The owner will deduct 50% of which of the following expenses on Schedule E?

A. landscaping.

Which of the following is not a example of a management decision considered for active particpation

A. particaption in the operation's activity on a regular and substatial basis.

all of the followign are reasons to file an amended return except:

A. the taxpayer receives a notice from the IRS. the disagre with the notice and beileve their orginial return was filed correctly

If a taxpayer receives a bonus or award(cash, Goods, services,) from their emplyeer , must they include its value in their income for the tax year in which it was received?

A. yes.

Remeber Michelle? She is still married to Brian. Michelle has not spoken to him for 15 years. Her 16 year-old daughter with her all year. Can michelle File using the head of household filing status?

A.Maybe. More information is needed

The fact that an employee is having taxes withheld from their paycheck does not guarantee that tax liability will be covered. what factor could cause an employee to have a withholding shortfall a the end of the year?

Additional income is earned from self-employmeny

In the event of a conflict of interest, tax prepars subject to circular 230 may still respresent the cilents under certain circumstances. all of the following apply, EXCEPT:

B, District General Manager approval.

A taxpayer filed form 4868 on april 15, 2020, and submitted their $897 balance due return to the IR on October 15, 2020. They did not submit any payment with Form 4868 . which penalty applies?

B, Failure to pay.

Nova, a taxpayer who uses the single filing status, purchased 200 shares of ELM stock for $2,000 august 15 2019. She sold the shares on December 19, 2019. for $3,000. Nova's 2019 taxable inco $37.250, so her marginal tax rate is 12%. How much tax will Nova pay on the sale of her shares of stock

B. $120

An active participant with modfied AGI below the limit may deduct rental losses up to:

B. $25,000

Victor and Xavian quin are married and will file a joint return with taxable income of $73,678 using the tax tables, what is their amount of tax?

B. $8,453.

Geraldine purchase a new lawnmower for $1,000 . she uses it 90% for her landscaping business and 10% on her own lawn. What is its depreciable basis?

B. $900.

Geraldine purchased a new lawnmowner for $1,000. She uses it 90% for her landscaping business and 10% on her own lawn. What isn its depreciable basis?

B. $900.

The Irs Publication , your Federal Income Tax(for Individuals), is Publicatiobn]:

B. 17.

Which of the following statements about the (ACTC) is true? The ACTC is

B. A refundable credit.

Which of the following is not one of the rules for anyone wanting to claim the EICTc?

B. A. Earned income is only allowed from wages, tips and salaries.

Alex and jane are married and plan to file a joint return. In prior years, jan wroked while Alex work full-time graduate student. This year, Alex graduated and began a full-time job. Jane's salary this is sigificantly higher than Alex's. Which of the following is the best adivce regarding their forms 4?

B. Alex should only complete Step 1, Personal information , and Step 5, his signature, on his 2020 Form W-4 . Jane should complete the Step 1 and Step 2(b) Mutliple Jobs worksheet and Step 5, using both her and Alex's Information.

Four taxpayers own a business together. which one satisfies one of the material participation tests?

B. Alexa, who Participates 550 hours

Four Taxpayers own a business together. Which one satisfies one of the material participation tests?

B. Alexa, who particpated 550 hours

Danielle purchased a home with her husband Neville in March of 2019 for $700,000 in a separate property state. In June of 2019, Danielle and Neville separated. On December 31, they were still legally married but were not living together. Neville refused to file a joint return with Danielle. Daneille is living in the home and has continued to make the mortgage payments. Danielle and Neville have no children. Assuming they are both able to itemize deductions. on what portion of the acquisition debt will interest be deductible on Danielle's tax return for 2019?

B. Danielle may only deduct interest on $375,000 of the acquisition debt.

Which taxpayer should file an amended return?

B. Deleah. After she timely filed her 2019 return, she discovered that she had neglected to report $980 in income from a job she only held for two weeks that year.

Which of the following items is not included in federal gross income?

B. Federal income tax refunds

Which of the following dependents can be used as a qualifying person for the head of household filing status but cannot be used for the qualifying widow(er) filing status?

B. Foster Child

Funds used from which of the following do not have to be subtracted from otherwise eligible education expenses?

B. Grants

Which of the following tests is not one that must be met for a dependent to be a taxpayer's quailfying child?

B. Gross Income

Taxpayers will usually need to make estimated tax payments for the current year when they:

B. Have Considerable amounts of self-employment or investment income.

Which of the following tax benefits will not travel to the noncoustdial parent when using the rules for divorced or separated parents?

B. Head of Household filing status.

Which of the following is not a part of schedule C?

B. Information on your vehicle

You should ask the taxpayer more questions whenever the information you have recivied appears to be (check all that apply)

B. Insenstive.

Which type of their children's income can a parent elect to include on their own return?>

B. Interest and divdends less than $11,000

Which of the following correctly calculates a taxpayer's loss that was a direct result of a casulalty if it occured in a federally declared disater area in 2019?

B. Joe's personal automobile, a 2011 Toyota Coroila Hatchback, was purchased December 1. 2012. it was flooded and damaged by failing branches during tropical storm Dorian. Joe had never used his car for business purposes. the car's adjusted basis (cost) $18,000. FMV before the loss: $6,000 FMV after the loss. $500. Expected insurance proceeds: $2,000. The amount of Joe's Casualty loss:$3,500.

in which of the following scenarios would a taxpayer not complete form 2106 and deduct the expenses described as a impairment -related work expenses on Schedule A (Form 1040) line 16?

B. Mercedes is moderately visually impaired. She is employeed as a barista at a local speciality cofee shop. Lately, She has been wearing, BioFit, walking shoes that co-worker recommended. They seem to prevent her feet from getting tired after working long hours.

What deprication convention is required when deteriming the depreciation deduction for real property?

B. Mid-month

Which of the following types of interest must be reported on a taxpayer's return, but is not Taxal:

B. Muncipial Bond

Which of the following quailfying relatives does not have to live with the unmarried taxpayer to qualify them for the head of household filing status?

B. Parent

On what part of Schedule F does an accrual basis Taxpayer report expense?

B. Part B

Which of the following is a way to avoid a faliure-to-pay-penalty?

B. Pay the tax by the original due date of the return.

From 4868 is filed to request a six-month extension of time to file a tax return. it does not:

B. Provide additional time to pay any tax due.

Which of the following statements about the child tax credit and/or the Additional child tax credit true?

B. The additional child tax credit is a refundable credit?

In referances to the adoption credit, a special needs child is a child who

B. The state has deterimed should not be returned to the parent's home and will probably not be adopted unless special assitiance is provided to the adoptingfamily

Which of the follwing taxpayers is not required to file a tax return? a single taxpayer with:

B. Wages of $10,000 and withholding of $100.

Which of the following is not a capitial asset

B. a rental home

Social sercuity wages

B. are capped at $132,900 for 2019

Taxpayers may begin depreicating qualifying assets on which of the following dates?

B. dates the asset is placed in serivce.

Which of the following tests is not one of the first three dependent requirements?

B. joint return

Faliure to-file and faliure-to-pay penalties can be wavied if the follwoing excption is proven:

B. reasonale Cause.

Which of the following taxpayers is not recognized as being married for the current tax year?

B. taxpayer whose divorce was finalized December 31st.

Which of the following statements is true about the American opportunity Tax Credit?

B. the AOTC is available to taxpayers who paid qualified education expenses for higher education for an eligibile student.

May a taxpayer claim as a qualifying dependent a foregin student brought to this country under a qualified international education exhchange program and placed in their home for a temporary period?

B. yes

Can the taxpayer's aunt be a qualifying relative (QR) if she did not live with the taxpayer's at all during the year, if all other QR tests are met?

B. yes. She passess the relationships part the test

Which of the following assets are considered collectibles and subject to a maximum tax rate of 28%?

C, Art, antiques, stamps, and coins.

If, when preparing a tax return, you realize the taxpayer is making intentional misrepresenations of their actual income and expenses, how should you proceed?

C, Do not file the tax return.

In specfi circimustance , tax prepares subject to Circuar 230 may disclose confidential tax return information. The two most common exceptions are the

C, Related party and written consent

Which of the following methods would be most benefical to a taxpayer who expects her income to increase susbtantally, in later years?

C, Straight line.

to ensure an accurate return, tax prepares must do all of the following except:

C, audit the return.

The annual captial loss deduction limit for a married taxpayer filing a separate return is :

C. $1,500

What is the standard deduction for a taxpayer filing as single?

C. $12,200.

Colin has a succesful consulting buisness and had a net profit of $86,394 on his Schedule C. How much self-employment tax will he pay?

C. $12,207.

What is the maximum amount of the lifetime learning credit?

C. $2,000 per return

Janet was a qualified full-time student for eight months. Bill worked full-time all year. They have two quailfying children for the child and Dependent care credit. How much is Janet's earned income for purposes of the credit?

C. $4,000

Myles and Millie, married and filinf jointly , owned and lived in her homes for ten years. In 2019, they sold their home at a long- term gain of $575,000. How much of the long-term gain can they exclude from income on their return ?

C. $500,000

What is the preparer penalty for failure to meet due diligence requirements?

C. $530 for each failure, per credit, on each return.

Their 2019 AGI is $96,324. which of the following correctly states their medical expense deduction o Schedule A (Form 1040)?

C. $7,233.

If a taxpayer has a capitial gain on quailfied small business stock, the stock, must be helkd a certain amount of time in order to exclude some or all of the gain. what years?

C. 5.

If a taxpayer has a captial gain on a qualified small buisness stock, the stock must be held a certain amount of time in order to exclude some or all of the gain. it must be held more that how many years?

C. 5.

A person born in 1945 reaches full retirement age at age:

C. 66

The maximum amount of social security income that may be taxed is:

C. 85%.

A married couple who materially participate in the operation of a jointly owned business may elect for each spouse to file their own Schedule C, with each reporting their respective amounts of income, loss, and deductions. This known as what?

C. A qualified joint venture

What does circular 230 require that you do if you discover that a taxpayer has previously not complied with the revenue laws of the united states?

C. Adivse the taxpayer of the facts, and the consequences for noncompliance

Which statement about amended returns is true?

C. An amended return should ne supported with any additional or corrected form that shows a change to the taxpyer's withholding

To be deductible a business expense must be;

C. Both A or B

Which of the following single taxpayers may be able to claim the EITC?

C. Cindy age 26, is a u.s citizen and has earned income of $13,980.

Which of the following dependents, who are claimed as quailfying relatives and lived with the taxpayer all year, do not quailfy an unmarried taxpayer for the head of household filing status?

C. Cousin

Choose the response that best completes the following sentence. A Taxpayer may claim an exemption from withholding on their Form W-4 when they:

C. Did not have a federal income tax liability for the prior of the year and do not expect to have any liability for the current year

Which of the following is not deductible on Schedule A?

C. Federal taxes withheld.

An employee tells their employer how much income tax to withold from their taxable wages by completing what form?

C. Form W-4.

Which of the following taxpayers is not required does not quailfy to deduct qualified educator expenses?

C. Gaylene is a high school substitute teacher in her local school district. She worked 1,040 hours in 2019. She speny $590 home schooling, her fifth- grade daughter jodie. She spent $230 on supplies used in various classrooms. she reimbursed for the supplies.

Which of the following scenarios best represents qualification for the farm optional method for sel-employment tax?

C. Gina had gross farm income of $7,222.

The education savings Bond Program allows taxpayers to exclude from income all or part of the interest they received on the redemption of qualified U.S Savings Bonds during the year if they qualified higher education expenses during the same year. What qualification apply to the Bond? The bond must be issued:

C. I n the name of either the taxpayer or the taxpayer and their spouse, and the owner must have been at least 24 years old before the bond issue date.

Which of the following describes a situation where taxpayer may need to do a ''paycheck checkup?

C. Marley and Derick are married and file jointly . they both work. The couple had twin son this year.

Doris and Aubrey were married. Doris died on February 1, 2019. On December 27, 2019. Aubrey married Freida. Aubrey and Frieda may file a joint return, or they may file separately, whichever they choose. Doris filing status for 2019 is

C. Marrie d filing separately.

Which taxpayer is subject to the faliure-ro-file penalty for not filing their 2019 federal income tax return by the due date?

C. Olivia, who has a $175 balance due. She requested an extension and paid $2,500 on April 12,2020. She filed her return on October 1, 2020.

Which of the following is not a valid accounting period?

C. Perodic Tax year.

Which of the following is not an example of disreputable conduct?

C. Preparing the current-year return for a taxpayer when the tax preparer realizes the taxpayer omitted items on a prior-year return.

What should you do if a taxpayer brings in a Form W-2 that has an obviously altered SSN?

C. Question the client carefully and document the responses.

A taxpayer with a gain on the sale of a collectbile will figure their tax using the:

C. Schedule D Worksheet

Matthwed is not a real estate proffessional, but he is an active particpiant in a rental real estate acitvity. Where will he report his income and expenses?

C. Schedule E, Page 1.

Which of the followign methods would be msot benefical to a taxpayer who expects her income to increase substantially in later years?

C. Straight line.

Which of the following statements is correct about interest?

C. The amount of a penalty on early withdrawal of savings may be more than the total amount of interest income received by the taxpayer.

Which of the following is not a qualifying education expense for the purpose of a Coverdell (ESA) ?

C. The cost of room and board for a university student enrolled in one course (three credit hours) per semester.

Which of the following statements is true regarding alternative minimum tax (AMT)

C. Under amt, the amount that taxpayers can claim for certain credits and deduction is limited.

What is the time frame for filing Form 1040-X in order to obtain a credit or a refund?

C. Within three years (including extensinions) after the date the orginil return was filed and two years after the date tax was paid, whichever is later.

To be deductible, a business expense must be:

C. both A and B

A taxpayer who recives income from a partenrship will receive:

C. schedule K-1 (form 1065).

when a lawnmower and sublessor who rent farm land and farm property to tenants materially particpates in the operation or management of the farm, this usually means that:

C. self-employment tax will apply to the landowner

Why must a taxpayer file from 4962, Premium tax credit (PTC) of they receive Form 1095-A?

C. to reconcile the Premium Tax Credit

You sold your bicylce at a $50 loss. Your school laptop at a $100 loss, and your business cell phone at a $200 loss. What is your deductible loss?

C.$200.

The IRs defines the custodial parent as the parent:

C.. The child spent more nights with.

Which of the following steps is not necssary when preparing a 2018 amended return where only the amounts are being changed on the original tax return?

Check a box, in a part II, Presidential Election Campaign fund, even if there is no change from the orginial return.

Patricia summers bought her home for $206,000, plus $400 in legal fees and $3,300 in other closing costs. The basis of her home is:

D, $209,700

The annual capitial loss deduction limit for a taxpayer using the single filing status is:

D, 3,000

The earliest date shares of stock purchased on january 17, 2018, could be sold and receive long-term gain or loss treatment is

D, January 18, 2019

The standard deduction for the single filing status is allowed to be increased by how much for blindness?

D. $1,1650.

Jamie and Jerry Jarvis purchased their home in Vicksburg(wareen County) mississppi, In 1998 of $125,000. Severe storms, straight-line winds, torandoes, and flooding occured in their county during the month of February 2019, and the President delcared their county a disaster area (DR-4429) on April22, 2019. Just nefore the storm, The FMV of the Jarvis's home was $175,000. After the storm, the FMV of their home was $90,00. they received a grant from FEMA for $15,000 which helped with some of the repair costs. They also received insurance proceeds off $52,000 soon after the storm event. janine and Jery file jointly and do not itemize. Their 2019 AGI was $87,500. They had a qualified disaster loss of $18,000. What amount can they calculate on Schedule A (Form 1040) and report as their increased standard deduction on form 1040 or 1040-SR, line 9, in 2019?

D. $41,900.

Support includes a amout paid by which of the follwing?

D. All of the Above

Which of the following taxpayer may not claim the lifetime learning credit?

D. All of the above

Which of the following statements about the Child and Dependent Care Credit is true?

D. Employeer -provided benefits for dependent care,reported in box of 10 of a taxpayer's Form W-2 must always be entered on Form 2441

If a taxpayer does not pay enough tax on a timely basis during the year, they may be required to pay an underpayment penalty. This penalty is computed on:

D. Form 2210

Which of the following is not considered gross income?

D. Gifty.

Which of the following is a deductbile expense for a rental activity?

D. Homeowner's insurance

Which of the following taxpayers may claim the Child and Dependent Care Child?

D. Marvin paid for his spouse, Seth, who is disabled, to have- in home care while he works.

If the farmer does not materially participate when receiving rental income for crops sharing on land, then the income is:

D. Not included as self-employment income and reported on form 4835

Which of the following is not included in the cost of maintaining a household?

D. Rental value of a home owned by the taxpayer.

Which of the following is an example of portfollo income?

D. Royalities from an oil well

Which of the following is an example of portfolio income?

D. Royalties from an oil well.

When preparing a tax return for a self-employed person, which of the following forms would typically not be used?

D. Schedule SE.

On july 2, 2018. Kendra purchased 80 shares of HOH stock for $2,000. on July 2, 2019 she sold 40 shares for $900 . July 31, 2019, she sold the other 40 shares for $2,400 . Therefore, Kendra has a

D. Short-term loss of $100 and a long -term gain of $1,400.

Michelle married to Brian. Michelle has not spoken to him for 15 years., which of the following filing statuses can be ruled out for michelle to use?

D. Single.

Sam (230 is single. he worked full-time one semester and attended classess one semester of 2019. He is fred's son and lived with Fred. What qualifying child (QC) test still needs to be asked?

D. Support.

Which of the following is not a requirement to use the simplified method?

D. The pension was received before 1996.

Taxpayers who are entiled to a refund can use form 8888, allocation of Refund, to divide the refund into how many different accounts?

D. Three

A taxpayer may file Form 8379 to receive the injured spouse allocation of a married filing jointly federal tax refund that may be offset by all of the following types of past due payments Except

D. Utility payments

Which one of the following does not dicate whether a nondependent is required to file a tax return?

D. if the taxpayer has any dependents.

When depreciating an asset, the enitr e cost of teh asset is deducted:

D. over a period of years, rather them all at once.

Which of the following is not a part of schedule C?

D. self-employment tax.

Distriubutions from traditional IRAs are not taxable:

D. to the extent the distrubution represents return of nondeductible contributions.

Is Lyod required to submit any additional forms or schedules with his amended return?

D. yes, He must include a Schedule B.

Which of the following benefits can travel to a noncustidal parent if the divorced or separated parent rules are allowed?

D.Child Tax credit

Taxpayers who made a nondeductible contributions to a traditional IRA calculate the taxable amount of a distribution:

D.Using from 8606.

Which of the follwing statemetns is not true regarding a paid tax return prepar's due diligence for CTC/ODC?

D/. Must meet three of the four due diligence requirements to allow the taxpayer to claim the Child Tax Credit.

Which of the following is true in regards to estimated tax payments for farmers?

If a farmer files their 2019 return and pays all tax due by march 1 2020 , then they will not be required to make estimated tax payments.

Under what circumstances may an employee claim exemption from withholding?

If the employee had no federal income tax liability for the prior year, and they expect to have no tax liability for the current year.

Who has the superior claim to Blake's dependency?

Jamie

The earliest date shares of stock purchased on january 17, 2018, could be sold and receive long .

January 18, 2019

Which of the following describes a situation where a taxpayer may need to do a ''paycheck checkup?

Marley and Derick are married and life jointly. they both work.. The couple had twin sons this year.

Which of the following is earned income?

Self-employed buisness income

The failure -to-file penalty is assessed on which of the following 2019 returns?

a, Balance due, return due april 15, 2020, but not filed until december 15, 2020 with an extension

A tax returner or claim for refund requiring a paid tax return preparer to determine eligibility for EITC, CTC/ODC/ ACTC, AOTC, and the head of household filling status may be subject to a maximum penalty, totaling what amount for failure to meet due diligence requirements if all four are claimed on a single tax return?

a,$2,120

Cameron and Deleah married in 2014, and they purchased their first home for $280,000 in 2015. it served as their primary residence until march 2018. After being on the market for ten months, the home finally sold in Januray 2019 for $410,000. The couple paid a $24,600 commission as an expense of sale. they will file a joint return for 2019. their taxable income is $172,000, placing them in the 24% marginal tax bracket.

a. $0.

the deduction for state and local income taxes is limited to what amount?

a. $10,000 ($5,000 if MFS).

a taxpayer who actively participates in a rental real estate activity may, in many cases, deduct up to what amount of rental losses against any other kind of income?

a. 25,000

Which of the following assets does not qualify for bonus depreciation?

a. Camera used 45% for business.

Which of the following taxpayers is eligibile to file as a qualifying widow(er) for 2019?

a. Christy and Daniel were married for seven years before Christy passed AWAY IN JUNE 2017 after she was in a car accident. Christy's son Trevor, (Danie's stepson) continued to live with daniel after his mother died. In 2017, Daniel filed his tax return as married filing jointly. In 2018, Danie; filed as a qualifying widower. Daniel has not remarried. He pays 100% of the cost of the maintaining a home for Trevor and himself in 2019.

when a taxpayer receives Form 1099-R with no amount entered box 2a and code 7 entered in box 7, the entire distrubtion:

a. Could be taxable.

What is the rule for the deduction of prepaid farm supplies?

a. Farmers whose prepaid supplies exceed 50% of total farms expenses may only deduct the expenses in the year used

What are the rules for chaning a filing status after the due date of the return?

a. Filing staus may not be changed from married filing separately after the due date of the return.

Which of the following describes a qualified charitable deduction Tax Year 2019?

a. Gertrude volunteers as an to usher at a local nonprofit 501(c) (3) performing arts center helping to direct and seat guests during performance. A uniform jacket is required that each volunteer must purchase. Gertrude paid $62 for her jacket in 2019. Volunteer ushers are not allowed to sit and view the performances.

Which of the following is not one of the five quailfying child tests a taxpayer must meet their child to be considered their dependent?

a. Gross income test.

Marissa and lucius were married 18 years ago. They had one child, Matthew (13.) luciuis pased away in 2015. Marissa did not remary. Marissa and mathhew lived together all year long, and no one else lived with them. Matthew had no income in 2019. Marissa paid 100% of the cost of the maintaining their home. What is the most benefical 2019 filing status for Marissa?

a. Head of household.

In addition to rental real estate activities , which type of income is considered passive?

a. Income from a business in which the taxpaper does not materially participate .

Stock owned by an individual would be classified as what type of property?

a. Intangible personal, investment -use property

Under which situation in Tax Year 2019 is Lillian most likely to benefit from itemizing her deduction

a. Lillian is 46 years of age, files single, and has an AGI of $52,300.

Which line in the header is used to enter the farm activity?

a. Line A.

Which of the following is not recorded on schedule C?

a. Self-employment Tax.

Which of the following is a valid method for calculating the home office deduction?

a. Simplified Method.

Which of these would be factors indicating that a contract exists for prepaid expenses?

a. The contract names a specific quanitiy

Which of the following best describes gross income?

a. all income from whatever source derived, unless excluded from taxation by law

Which of the followingtaxpayers is eligible to file as head of household of 2019 >

a. amy (42) is unmarried and paid 56% of the cost of the maintain g a home for her father, ron (77) all year. amy will claim Ron on he rtax return in 2019/

Which of these expenses has a separate line on Schedule F?

a. chemicals

In which of the following circumstances will a taxpayer probably be unable to avoid a penalty for underpayment of estimated tax?

a. they paid their balance due within 60 days of the due date of the return.

in general, what is the applicable time limit for filing an amended return to claim a refund? an amended return must be filed within

a. three years of the filing data, of the return being amended or withing the two years of the date the tax was paid, whichever is later.

Why would a taxpayer need to file form 1040-X?

a. to correct errors on the original return that result in a change to the orginial tax liability

why would a taxpayer need to file Form 1040-X?

a. to correct errors on the original return that result in a change to the original tax liability

Which of the following expenses quailifies for an education credit in 2019?

a. tutition payments?, the taxpayer didn't receive scholarships, grants, or other nontaxable benefiets

Michelle's Form 1040-X indicates in that she owes $305. Should she file a Form 1040-X?

a. yes , She should file a form 1040-X to correct the original form 1040 she filed with income omitted.

Josh pays $1,760 for electricity for his house and farm. of that expense, 74% of the cost is attributable to his farming operations. how much is deductible as an expense?

b $1,302.

Which of the following statements is true about IRAs

b, A taxpayer may contribute to traditional and roth iRAs for the same tax year

Brian had dividened income reported on Form 1099-DIV. Brian would be required to file a form 1040, schedule B, when his dividened income exceeds of which of the following households?

b. $1,500.

Nova, a taxpayer who uses the single filing status, purchased 200 shares od ELM stock for 2,000 on august 15, 2019. She sold the shares on december 19, 2019, for 3,000. nova's 2019 taxable income is $37,250, so her marginal tax rate is 12%. How much tax will Nova pay on the sale of her shares of stock?

b. $120

During 2019, Romelo spent $2,500 for lottery tickets and saved all of the tickets he purchased. he won $2,000 in August on a $2 state lotto scratch-off ticket. Romelo's 2019 adjusted gross icome is $68,000. How much of his lottery ticket costs can Romelo deduct as an itemizied deduction on his Schedule A (form 1040)?

b. $2,000.

What is the maximum deduction allowed for quailifed student loan interest?

b. $2,500.

An active participant with modified AGI below the limit may deduct rental losses up to:

b. 25,000

For a taxpayer to claim the Child Tax Credit , their qualifying child must be

b. A qualifying dependent under age 17 on their return.

Which of the following best reprsents the treatment of expenses for farm hobby income? the expenses:

b. Can no longer be deducted.

Taxpayers may begin depreciating qualifying assets on which of the following data

b. Date the asset is placed in service.

which of the following statements about qualified retirement plans for self-employment taxpayers is true?

b. Defined contribution plans, such as 401(k) plans, are available to self-employed taxpayers.

Which of the following taxpayers is not required to file a federal income tax return for 2019?

b. Elizabeth (68) has gross income of $12,250. she is single and has no dependents

Estimated texes are computed and paid:

b. Quartely.

A sole proprietor who computes self-employment tax should be filling what form?

b. Schedule SE.

How much tax-free educational assistance may an employeer make avabile to employee, and hc is it reported?

b. an employer may offer up to $5,250 in tax-free education assistance to employees, and it is often reported on Form W-2 box 14.

John hires a household employee during the harvest to help around the house. The wages attriuable to which task cannot be fully deducted.

b. cooking dinner for the famliy and all the workers each sunday

Which of the following tests is not one that must be met for a dependent to be a taxpayer's qualifying of child?

b. gross income

Mike is single and has a taxable income of $17,405. His amount of tax from the 2019 Tax tables is

c. $1,897.

Adrian is married filing separatly, and has a taxable income of $26,100. His amount of tax from the 2019 tax tables is

c. $2,941.

Curtis(71) and Shirley(64) are married filing jointly with gross income of $25,770. Curtis and Shirley, are required to file a return because their gross income exceeds their filing requirement of

c. 25,700

Barbars is law-clerk for your county. Which of the following types of retirement plans would she contribute to through her employee?

c. 457

Which of the following best describes earned income?

c. Income received for services, performed, including wages, commissions, tips, and generally, farming and other business income.

A taxpayer who receives income from a partnership will receive:

c. Schedule K-1

Which of the following taxpayers is not able to claim the Child and Dependent Care Credit?

c. Sideny and Stella Anderson have a dependent daughter, Andera (8). Sideny works full-time, and Stella is extensively involved in charity work. They paid the Daily Child Care Center to take care of Andrea while Stella volunterred for various charitable organizations.

Which of the following statements is not true about the american opportunity tax credit (AOCTC)

c. Taxpayers may claim the AOCTC if they file MFS or have modified adjusted gross income (MAG) above $90,000 (180,000 for MFJ)

In 2019, Jennfier's (27) brother, jim (18), her fiancee Steve(29) and her daughter, Kim (5) lived with her for the entire year. Jennfier's AGI is $27,800, Jim's AGI is $5,050, Steve AGI is $4,0050, and Kim had no icome. Jim and Kim did not provide over 50% of steve's support. Jennifer quailties and files as head of household in 2019. How many qualifying dependents can jennfier claim on her return?

c. Three

When preparing a tax return for a self-employed person, which fof the followign forms would typically not be used?

c. form W-2.

Which taxpayer has a short-term capital gain or loss on the sale of the property?

c. melba. she purchased 100 shares of JCN stock on july 9 2018(the trade date) . she sold the shares on july 9 2019

Which taxpayer has a short-term capital gain or loss on the sale of the property?

c. melba. she purchased 100 shares of JCN stock on kuly 9 2018 (the trade date) she sold the shares on july 9 2019

Which of the following statements about retirement account distributions is true?

c. the taxable portion of a pension or annuity with a starting date of june 3, 2019, is calculated using the simplified method.

What is the maximum amount of the America Opportunity Tax Credit a taxpayer could receive?

d. $2,500

Which of the following is not a percentage of social security benefits subject to federal tax up to:

d. 100%

A taxpayer who underpays their tax due to negligence or disregard of the rules to subject to a penalty of.

d. 20 % of the underpayment.

Nakita was born in 1957. Based on her year of birth, when would Nakita reach full retirement age for social security benefits?

d. 66 years and 6 months.

The IRS may assess penalties on taxpayers for which of the folllowing?

d. All of the Above

Issac comes into your office on April 15. you prepare a return for him which shows a 2,354 balance due. Issac tells you that he cannot afford to pay the balance due at this time, but believes he can raise the funds before the end of the may by selling some stock that he owns. issace has never filed his return late before and has always paid the full balance due when he filed.

d. Contact the IRS to arrange a short-term payment plan.

The Child and the Dependent Care Credit?

d. Never completely phases out.

Which of the following statements is true but dividends?

d. Qualified dividends are those recived on shares of stock in domestic corporations and certain foregin corporations that meet the holding requirements.

Which of the following taxpayers is not required to file a federal tax return for 2019?

d. Ron (66) and sue (64) have gross income of $ 25,250. they wish to file a joint return

Which of the following tests is not one of the first three dependent requirements?

d. Taxpayer must have provided over 50% of potential dependent's support.

Which of the following items is included in federal gross income?

d. Unemployment compensation.

Which of the following types of property may be depreciated?

d. a copier purchased by a tax preparation office.

Which of the following statements is not correct regarding a paid tax return prepar's due diligeen for ACTC?

d. must meet three of the four due diligence requirments to allow the taxpayer to claim the additional child tax credit

Which of the following taxpayers may claim the lifetime learning credit?

d.Elizabeth(23) paid $8,735 to attend college as a full-time candiate,seeking a master's in social work. She purchased her books for $435 through the school as a requirement for enrollment. she is not being claimed as a dependent by any other taxpayers

if a taxpayer rents a portion of their personal residence, can they deduct mortgage interest as ar expense on Schedule E?

the rental portion of this expense can be deducted