Select the best answer.A cousin did not live with the taxpayer all year, but the taxpayer provided more than half of the cousin's support.The cousin was unmarried, had no income, and meets the three general dependency tests. Which is the test thatdisqualifies the taxpayer from claiming the cousin as a dependent?O A. Gross incomeO B. Joint return testO C. Member of household or relationshipO D. SupportQuestion Q4Submit Answers92% CompleteExit & Resume LIfwhoH-hadA&aicc url=https://hrblock.csod.com/LMS/scorm/aicc.aspx

The concept being referred to in the question is the dependency test used by the Internal Revenue…

Answered: Select the best answer. of the cousin's…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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For purposes of counting hours spent participating in a non rental real estate activity, participation by the taxpayers spouse is considered participation by the owner. True or false
As a tax return preparer for The Fernando Rodriguez Tax & Accounting Service, you have been asked to calculate the missing information for one of the firm's tax clients. The following table gives the standard deduction for various filing statuses. Standard Deductions Single or married filing separately Married filing jointly or surviving spouse Head of household 65 or older and/or blind and/or someone else can claim you (or your spouse if filing jointly) as a dependent: Warfield Name Filing Status single Using the standard deduction table above, complete the following table (in $). Income $12,000 $3,340 $24,000 $18,000 Varies (See www.irs.gov for information.) When finding your client's taxable income, which deduction did you use? standard deduction itemized deductions Adjustments to Adjusted Gross Income Income $49,160 Standard Deduction ---Select--- Itemized Deductions $13,160 tA Taxable Income
Which of the following is a true statement with respect to the gross income test for the qualifying relative dependency exemption? a.The gross income test does not have to be met provided the relative is under age 19 at the end of the tax year. b.The gross income test does not have to be met provided the relative is a student. c.The gross income test does not have to be met provided the relative is under age 24 at the end of the tax year. d.The relative must receive less than $4,200 of gross income in order to qualify. e.All of these choices are correct. Martin, a 50-year-old single taxpayer, paid the full cost of maintaining his dependent mother in a home for the aged for the entire year. What is the amount of Martin's standard deduction for 2019? a.$24,400 b.$19,600 c.$12,200 d.$18,350 e.None of these choices are correct. Which of the following is not a capital asset? a.Stocks b.Land c.Gold d.A personal automobile e.Inventory
Which of the following correctly completes the sentence regarding the tax treatment of a housing allowance received by an ordained minister? The housing allowance is ______ income for federal income tax purposes and ___________ income for self-employment tax purposes. Included in; included in. Included in; excluded from. Excluded from; included in. Excluded from; excluded from.
Enzo is preparing a client's return. The taxpayer is claiming the Earned Income Credit (EIC), Child Tax Credit (CTC), Additional Child Tax Credit (ACTC), and the American Opportunity Tax Credit (AOTC). Which of the following best describes the actions Enzo must take to substantiate the taxpayer's eligibility for the credits?
Which one of the following statements describes the consequences of using the filing status 'married filing jointly'? A spouse may not be held responsible for tax if that spouse had no income. The tax rates are generally more favorable than that of two single individuals if one has high income and the other has low income. If it is elected on an original return, it may be changed on an amended return.
Your client wants to purchase a residence for his aging parents, while minimizing the burden of ownership of the property for them and maximizing their enjoyment of it. Which one of the following states an advantage of titling the property in your client's name as sole owner rather than in joint tenancy with right of survivorship with his parents? A) The property will receive a step-up in basis when his parents die. B) The property will pass to his parents outside of probate. C) He will avoid gift tax liability by titling the property this way. D) His parents will have a life estate in the property if he predeceases them.
Which of the following statements is incorrect? Assume that the rental activity is classified as ‘production-of-income.’ If the taxpayer sells the rental property later at a loss, the loss will be treated as a capital loss (i.e., $3,000/$1,500 deduction limit in the current year). An amount that would have been paid in an arm’s-length transaction is considered a reasonable amount as deduction. Payment (except for medical or educational expense) of another person’s obligation does not result in a tax deduction for the payer. Regarding the start-up costs, if the new business is in the same line of business as the existing one and if the new business is not launched, then none of the start-up costs are deductible. Payments for a speeding ticket are nondeductible. HELP
Which of the followings is included in taxpayer’s gross income (i.e., taxable)? a.Compensatory damage payments received from physical injury by accident caused by other party. b.Punitive damage payments received. c.Accident and health insurance payments received as loss of income under the policy purchased by the taxpayer. d.Qualified employee discount up to the gross profit percentage for goods. It is nondiscriminatory and employees work for the line of business in which the goods are being sold. e. Employee’s salary during the year, which is contributed to employee’s qualified pension plan.
Which of the following statement is true? A. Lifetime learning tax credit is available for each qualified student including taxpayers and dependents. B. Tax credits reduces a taxpayer’s taxable income dollar for dollar. C. The child tax credit is subject to phase-out based on the taxpayer’s AGI. D. To qualify for the earned income credit, the taxpayer must have a qualified dependent. E. The American opportunity credit is available only for those students who are in their first or second year of post-secondary education.
As a tax return preparer for The Fernando Rodriguez Tax & Accounting Service, you have been asked to calculate the missing information for one of the firm's tax clients. The following table gives the standard deduction for various filing statuses. Standard Deductions Single or married filing separately $12,000 Married filing jointly or surviving spouse $24,000 Head of household $18,000 65 or older and/or blind and/or someone else can Varies claim you (or your spouse (See www.irs.gov for information.) if filing jointly) as a dependent: Using the standard deduction table above, complete the following table (in $). Name Filing Status Income Adjustments to Adjusted Gross Income Income Itemized Taxable Deductions Income Lerner married filing jointly $ $1,377 $47,278 $5,329 $ When finding your client's taxable income, which deduction did you use? O standard deduction O itemized deductions Standard Deduction $ ---Select--- v
Which of the following statements is true? Oa. A one-time election is available to taxpayers 55 years of age or older which allows them to sell their personal residences and to exclude all of the realized gain. Ob. A taxpayer's personal residence qualifies for a like-kind exchange. Oc. A taxpayer who sells a personal residence may always exclude the realized gain from taxable income. Od. None of these choices are true. Oe. All of these choices are true.

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