Jill is 16 years old and worked at her local grocery store over the summer earning $5,600. Is Jill legally required to file a tax return? If no, should she? Explain.
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Jill is 16 years old and worked at her local grocery store over the summer earning $5,600. Is Jill legally required to file a tax return? If no, should she? Explain.
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- Mary(58) comes into your office to have her tax return prepared. She states that she wants to use the head of household filing status and claim the Earned Income Tax Credit (EITC). She also tells you that her dependent child is her granddaughter, Julie (12), who currently lives with her. You as a paid tax preparer, all of the following are appropriate questions to ask or actions to take EXCEPT: 1). Ask Mary how long Julie has lived with her and inquire into the whereabouts of Julie's parents. 2). Ask Mary who paid most of the expenses of maintaining her home. 3). Inform Mary that she must show you documentation proving Julie lived with her before you can prepare the return. 4) Inquire as to whether anyone else can possibly claim Julie as a dependent.Marisa is 16 years old and a dependent of her parents. She earned $5,000 of income from wages working at Crave Ice Cream Shop and has $3,000 of interest income from corporate bonds. Which of the following statements are true? She is not subject to kiddie tax because she has earned income. She is subject to kiddie tax on both her earned and unearned income. Her unearned income over $2,200 is taxed at her parents’ tax rates. Her earned income over $2,200 is taxed at her parents' tax rates. Her earned income is taxed at her rates. All $3,000 of her investment income is subject to tax at her parents’ tax rates. Group of answer choices I only None of these options II only III and IV V only III and VAdelaide is self-employed and must submit estimated quarterly tax payments. Her predicted total tax liability for the current year will be $36,000, and her current withholdings are $18,283. She is advised to determine her quarterly payments by subtracting her current withholdings from her predicted total tax liability and dividing by four. What is a good estimate for Adelaide to use for her quarterly payments?
- A paid tax preparer must demonstrate due diligence. Review the following scenario, and then choose the appropriate response. Cherylynn Johnson (58) comes in to your office to have her tax return prepared. She states that she wants to use the head of household filing status and claim the Earned Income Tax Credit (EITC). She also tells you that her dependent child is her granddaughter, Alana (12), who currently lives with her. All of the following are appropriate questions to ask or actions to take EXCEPT: Ask Cherylynn how long Alana has lived with her and inquire into the whereabouts of Alana's parents. Ask Cherylynn who paid most of the expenses of maintaining her home. Inform Cherylynn that she must provide you with documentation proving Alana lived with her before you can prepare the return. Inquire whether the IRS has ever denied or reduced Cherylynn's EITC in a prior year.Juanita is a single and is self-employed. Juanita owed $1,300 in taxes on her 2019 return andexpects her taxes to be the same for 2020. Which of the following statements is correct?Select one:a. Juanita will not be required to pay estimated tax payments for 2020.b. Juanita will not be subject to self-employment tax.c. Juanita should take out a loan to pay her 2020 taxes when she files the return.d. Juanita should make estimated tax payments to avoid an underpayment penalty.Taylor, age 14, is claimed as a dependent by her parents. For 2023, she has the following income: $3,200 wages from a summer job, $1,755 interest from a money market account, and $1,875 interest from City of Chicago bonds. If required, round your answers to the nearest dollar. If required, round your answers to the nearest dollar. If an amount is zero, enter "0". Click here to access the 2023 tax rate schedule. a. Taylor's standard deduction for 2023 is $ Taylor's taxable income for 2023 is $ Feedback Check My Work $ 3,600 ✔ . To reduce the tax savings that result from shifting income from parents to children, the net unearned income (commonly called investment income) of certain children is taxed using special rules. This provision, commonly referred to as the kiddie tax, applies to any child who is under age 19 (or under age 24 if a full-time student) and has unearned income of more than $2,500. b. Compute Taylor's "net unearned income" for the purpose of the kiddie tax. 1,755 X 0 X.…
- Leslie graduated with her bachelor's degree in Accounting. She works for a CPA firm that pays her tuition ($8,150 per year) for her so that she can receive her MBA. How much of the $8,150 tuition benefit does Leslie need to include in her income?According to the statistic in the case study, what percentage of tax returns are selected for examination each year?Karen most had a federal tax levy of 2100.50 against her. If Most is single with two personal exemptions and had take home pay of 499 this week, how much would her employer take from her pay to satisfy part of the tax levy?
- Karen Most has a federal tax levy of $2,100.50 against her. If Most is single with two personal exemptions and had a take-home pay of $499.00 this week, how much would her employer take from her to satisfy part of the tax levy?AlpeshBruce and Amanda are married during the tax year. Bruce is a botanist at Green Corporation. Bruce earns a salary of $56,000 per year. Green Corporation has an accountable reimbursement plan. During the year, Bruce has $5,000 of employee expenses. Green Corporation reimburses Bruce for only $4,000 of expenses. Bruce decides to put $5,500 into a Traditional IRA. Amanda owns a financial consulting firm as a sole proprietor (it qualifies as a full trade or business). Amanda generates $80,000 of revenues during the year. She has the following business payments associated with her firm: Utilities: $2,000 Office Rent: $14,000 Self-Employment Tax: $5,000 Salary for her secretary: $20,000 Fines/Penalties: $8,000 Payroll Taxes (Employer Portion): $1,000 Business Meals: $2,000 Bribe to police officer to forgive parking violation $1,500 Due to the income and expenses above, Amanda has $39,500 of Qualified Business Income for the purposes of the QBI deduction. Also, during the year a tornado…
