Question 1

Criminal penalties only apply to:
A)Careless disregard for tax authority.
B)Willful failure to file a return.
C)Tax evasion.
D)Willful failure to file a return and tax evasion.

Accepted Answer

Criminal penalties in the context of taxation typically apply to intentional acts of non-compliance, such as willful failure to file a tax return and tax evasion. These actions demonstrate a deliberate attempt to avoid tax obligations.

Question 2

A 37- year-old taxpayer with a dependent child and claiming head of household status has received $21,000 in child support payments and earned wages of $46,000.Which is the simplest form this person can file?
A)1040A.
B)1040.
C)1040ES.
D)1040EZ.

Accepted Answer

The answer of A 37- year-old taxpayer with a dependent...

Question 3

Failure to make required estimated payments will subject the taxpayer to a potential underpayment penalty plus interest.However,if the difference between the tax shown on the return and the amount of tax withheld for wages is less than ________,the taxpayer will not be assessed a penalty.
A)$1,250
B)$500
C)$850
D)$1,000

Accepted Answer

The IRS generally does not impose an underpayment penalty if the difference between the tax shown on the return and the amount of tax withheld is less than $1,000.

Question 4

Which condition listed below is not required for a taxpayer to qualify as a qualifying widow(er)with dependent child?
A)The household was the principal place of abode for the entire year of both the taxpayer and his or her child.
B)Taxpayer must remarry before the end of the tax year in question.
C)Taxpayer paid more than half the cost of keeping up a household.
D)Taxpayer was eligible to file a joint return in the year the spouse died.

Accepted Answer

Qualifying widow(er) with dependent child status is available for two years following the year of the spouse's death, and the taxpayer must not have remarried before the end of that period. The other conditions listed (A, C, and D) are necessary for a taxpayer to qualify as a qualifying widow(er) with dependent child.

Question 5

A single taxpayer is 35 years old and has only wages of $16,000.Which is the simplest form this person can file?
A)1040A.
B)1040EZ.
C)1040ES.
D)1040.

Accepted Answer

The taxpayer's income is below $100,000 and consists only of wages, making them eligible to file the simplest form possible, which is the 1040EZ.

Question 6

The IRS can impose a ________ penalty on any portion of understatement of tax that is attributable to fraud.
A)25%
B)75%
C)50%
D)5%

Accepted Answer

The IRS can impose a 75% penalty on any portion of understatement of tax that is attributable to fraud. This is a significant penalty designed to deter fraudulent reporting on tax returns.

Question 7

What is the amount of the tax liability for a married couple filing jointly,having taxable income of $153,500? All answers should be rounded to the nearest dollar. Use the appropriate Tax Tables or Tax Rate Schedules.
A)$38,375.
B)$29,753.
C)$30,233.
D)$29,865.

Accepted Answer

For a married couple filing jointly in 2023, the tax brackets are as follows: 10% on income up to $22,000, 12% on income over $22,000 up to $89,450, 22% on income over $89,450 up to $190,750. Calculating the tax: 10% of $22,000 = $2,200; 12% of ($89,450 - $22,000) = $8,094; 22% of ($153,500 - $89,450) = $14,571. Total tax = $2,200 + $8,094 + $14,571 = $24,865.

Question 8

The failure to file penalty is ________ of the tax shown on the return for each month (or fraction of a month)the tax return is not filed,up to a maximum of 25%.
A)0)25%
B)0)5%
C)5)0%
D)5)5%

Accepted Answer

The failure to file penalty is 5% of the tax shown on the return for each month (or fraction of a month) the tax return is not filed, up to a maximum of 25%.

Question 9

What is the amount of the social security wage limitation for 2017?
A)$118,500.
B)$110,100.
C)$127,200.
D)$117,000.

Accepted Answer

The social security wage limitation for 2017 was $127,200.

Question 10

Luisa's parents can claim her as a dependent on their tax return.In 2017,her only source of income was a part-time job as a medical clerk where she earned $2,600 during the year.What is Luisa's standard deduction?
A)$2,600.
B)$4,050.
C)$1,050.
D)$2,950.

Accepted Answer

The answer of Luisa's parents can claim her as a...

Question 11

Ed's parents can claim him as a dependent on their tax return.In 2017,his only source of income was $1,050 of interest income received from Global Bank.What is Ed's standard deduction?
A)$1,050.
B)$1,000.
C)$4,050.
D)$350.

Accepted Answer

Ed's standard deduction as a dependent for the tax year in question is his earned income plus $350, but not less than $1,050 and not more than the standard deduction for an individual. Since his only income was $1,050 of interest income (which is unearned income), his standard deduction is $1,050.

Question 12

When a taxpayer can be claimed as a dependent on the tax return of another individual,the basic standard deduction for the taxpayer is limited to the greater of (a)________,or (b)the taxpayer's earned income plus $350,but not more than the amount of the basic standard deduction.
A)$1,000
B)$950
C)$1,050
D)$350

Accepted Answer

The correct answer is (C) $1,050. This is because the basic standard deduction for a taxpayer who can be claimed as a dependent on someone else's tax return is limited to the greater of $1,050 or the taxpayer's earned income plus $350, up to the standard deduction amount for an individual.

Question 13

What is the amount of the tax liability for a qualifying widow(er)with a dependent child and having taxable income of $121,600? All answers should be rounded to the nearest dollar.
A)$25,234.
B)$21,878.
C)$30,400.
D)$27,665.

Accepted Answer

The answer of What is the amount of the tax...

Question 14

The early withdrawal penalty is a for AGI deduction.Which form can the taxpayer use to claim this benefit?
A)1040EZ.
B)1040A.
C)1040.
D)1040A or 1040.

Accepted Answer

The early withdrawal penalty is reported on Form 1040, as it allows for a broader range of deductions and credits compared to the more simplified forms 1040EZ and 1040A, which have been phased out and replaced by a redesigned Form 1040.

Question 15

What is the amount of the tax liability for a head of household person having taxable income of $87,573? All answers should be rounded to the nearest dollar. Use the appropriate Tax Tables or Tax Rate Schedules.
A)$16,146.
B)$16,134.
C)$17,963.
D)$17,633.

Accepted Answer

The correct answer is A. The tax liability for a head of household person having taxable income of $87,573 is $16,146. This can be found using the Tax Rate Schedules.

Question 16

What is the amount of the tax liability for a single person having taxable income of $59,200? All answers should be rounded to the nearest dollar. Use the appropriate Tax Tables or Tax Rate Schedules.
A)$10,656.
B)$9,350.
C)$10,545.
D)$14,800.

Accepted Answer

The tax liability for a single person with taxable income of $59,200 can be calculated using the Tax Tables or Tax Rate Schedules. Based on the 2021 Tax Rate Schedules, the tax liability for this individual would be:
- $9950 x 10% = $995
- ($40,525 - $9,950) x 12% = $3,573
- ($59,200 - $40,525) x 22% = $4,977.50
Total tax liability = $995 + $3,573 + $4,977.50 = $10,545. Therefore, the best choice is C.

Question 17

What is the amount of the tax liability for a qualifying widow(er)with a dependent child and having taxable income of $18,355? All answers should be rounded to the nearest dollar. Use the appropriate Tax Tables or Tax Rate Schedules.
A)$1,836.
B)$2,331.
C)$1,838.
D)$2,753.

Accepted Answer

Using the 2021 Tax Rate Schedule for a qualifying widow(er) with a dependent child, taxable income of $18,355 falls into the 10% tax bracket. The tax liability is $1,836.

Question 18

The interest charged by the IRS for the first three months of 2017 was:
A)3%.
B)5%.
C)4%.
D)6%.

Accepted Answer

The interest rate for the first quarter of 2017, set by the IRS, was 4%. This applies to any unpaid tax balances for that time period.

Question 19

John forgot to file his tax return by April 15.He did not file an extension.John finally filed his tax return on June 30 and had a remaining tax liability of $1,500.What is John's failure to file penalty? Assume he made all his payments on time.
A)$375.
B)$225.
C)$233.
D)$300.

Accepted Answer

The failure to file penalty is 5% of the unpaid taxes for each month or part of a month that a tax return is late, up to a maximum of 25%. Since John filed his return 2.5 months late (April 15 to June 30), the penalty is 5% * 2.5 = 12.5% of $1,500, which equals $187.50. However, the minimum penalty for returns filed more than 60 days late is the lesser of $435 or 100% of the unpaid tax. Since the calculated penalty ($187.50) is less than both $435 and 100% of the unpaid tax ($1,500), the correct penalty is $187.50. The provided options do not include $187.50, suggesting a mistake in the question or answer choices. Based on the closest available option, $225 would be considered an incorrect choice, indicating a potential error in the question setup or a misunderstanding of the penalty calculation.

Question 20

The taxpayer's spouse died at the beginning of 2017.He has no qualifying child.Which status should the taxpayer select when filing his tax return?
A)Single.
B)Qualifying Widow(er).
C)Married Filing Separately.
D)Married Filing Jointly.

Accepted Answer

The answer of The taxpayer's spouse died at the beginning...

Quiz 2: Expanded Tax Formula, forms 1040A and 1040, and Basic Concepts

Criminal penalties only apply to:

A 37- year-old taxpayer with a dependent child and claiming head of household status has received $21,000 in child support payments and earned wages of $46,000.Which is the simplest form this person can file?

Failure to make required estimated payments will subject the taxpayer to a potential underpayment penalty plus interest.However,if the difference between the tax shown on the return and the amount of tax withheld for wages is less than ________,the taxpayer will not be assessed a penalty.

Which condition listed below is not required for a taxpayer to qualify as a qualifying widow(er) with dependent child?

A single taxpayer is 35 years old and has only wages of $16,000.Which is the simplest form this person can file?

The IRS can impose a ________ penalty on any portion of understatement of tax that is attributable to fraud.

What is the amount of the tax liability for a married couple filing jointly,having taxable income of $153,500? All answers should be rounded to the nearest dollar. Use the appropriate Tax Tables or Tax Rate Schedules.

The failure to file penalty is ________ of the tax shown on the return for each month (or fraction of a month) the tax return is not filed,up to a maximum of 25%.

What is the amount of the social security wage limitation for 2017?

Luisa's parents can claim her as a dependent on their tax return.In 2017,her only source of income was a part-time job as a medical clerk where she earned $2,600 during the year.What is Luisa's standard deduction?

Ed's parents can claim him as a dependent on their tax return.In 2017,his only source of income was $1,050 of interest income received from Global Bank.What is Ed's standard deduction?

When a taxpayer can be claimed as a dependent on the tax return of another individual,the basic standard deduction for the taxpayer is limited to the greater of (a) ________,or (b) the taxpayer's earned income plus $350,but not more than the amount of the basic standard deduction.

What is the amount of the tax liability for a qualifying widow(er) with a dependent child and having taxable income of $121,600? All answers should be rounded to the nearest dollar.

The early withdrawal penalty is a for AGI deduction.Which form can the taxpayer use to claim this benefit?

What is the amount of the tax liability for a head of household person having taxable income of $87,573? All answers should be rounded to the nearest dollar. Use the appropriate Tax Tables or Tax Rate Schedules.

What is the amount of the tax liability for a single person having taxable income of $59,200? All answers should be rounded to the nearest dollar. Use the appropriate Tax Tables or Tax Rate Schedules.

What is the amount of the tax liability for a qualifying widow(er) with a dependent child and having taxable income of $18,355? All answers should be rounded to the nearest dollar. Use the appropriate Tax Tables or Tax Rate Schedules.

The interest charged by the IRS for the first three months of 2017 was:

John forgot to file his tax return by April 15.He did not file an extension.John finally filed his tax return on June 30 and had a remaining tax liability of $1,500.What is John's failure to file penalty? Assume he made all his payments on time.

The taxpayer's spouse died at the beginning of 2017.He has no qualifying child.Which status should the taxpayer select when filing his tax return?