Question 1

Contrast the tax consequences resulting from the following filing status situations:
a.​
Married filing jointly versus married filing separately.
b.​
Married filing separately versus single filing separately.
c.Married filing separately versus abandoned spouse status.

Accepted Answer

The answer of Contrast the tax consequences resulting from the...

Question 2

During 2015,Madison had salary income of $80,000 and the following capital transactions: LTCG $13,000 LTCL 15,000 STCG 13,000 STCL 6,000 ​ How are these transactions handled for income tax purposes?

Accepted Answer

The answer of During 2015,Madison had salary income of $80,000...

Question 3

When can a taxpayer not use Form 1040EZ? Form 1040A?

Accepted Answer

The answer of When can a taxpayer not use Form...

Question 4

The Dargers have itemized deductions that exceed the standard deduction.However,when they file their joint return,they choose the standard deduction option.
a.Is this proper procedure?
b.Aside from a possible misunderstanding as to the tax law,what might be the reason for the Darger's choice?

Accepted Answer

The answer of The Dargers have itemized deductions that exceed...

Question 5

In resolving qualified child status for dependency exemption purposes,why are tiebreaker rules necessary? Can these rules be waived?

Accepted Answer

The answer of In resolving qualified child status for dependency...

Question 6

In satisfying the support test and the gross income test for claiming a dependency exemption,a scholarship received by the person being claimed is handled the same way for each test.Do you agree or disagree with this statement? Why?

Accepted Answer

The answer of In satisfying the support test and the...

Question 7

Adjusted gross income (AGI) sets the ceiling or the floor for certain deductions.Explain and illustrate what this statement means.

Accepted Answer

The answer of Adjusted gross income (AGI) sets the ceiling...

Question 8

Mr.Lee is a citizen and resident of Hong Kong,while Mr.Anderson is a citizen and resident of the U.S.In the taxation of income,Hong Kong uses a territorial approach,while the U.S.follows the global system.In terms of effect,explain what this means to Mr.Lee and Mr.Anderson.

Accepted Answer

The answer of Mr.Lee is a citizen and resident of...

Question 9

The Deweys are expecting to save on their taxes for 2015.Not only have both incurred large medical expenses,but both reached age 65.During the year,they also recognized a $30,000 loss on some land they sold which was purchased as an investment several years ago.Are the Deweys under a mistaken understanding regarding their tax position? Explain.

Accepted Answer

The answer of The Deweys are expecting to save on...

Question 10

Deductions for AGI are often referred to as "above-the-line" or "page 1" deductions.Explain.

Accepted Answer

The answer of Deductions for AGI are often referred to...

Question 11

In meeting the criteria of a qualifying child for dependency exemption purposes,when if ever,might the child's income become relevant?

Accepted Answer

The answer of In meeting the criteria of a qualifying...

Question 12

During 2015,Jackson had the following capital gains and losses: Gain from the sale of coin collection (held three years) $12,000 Gain from the sale of land held as an investment for six years 9,000 Gain from the sale of stock held as an investment (held for 10 months) 3,000 ​
a.How much is Jackson's tax liability if he is in the 15% tax bracket?
b.If his tax bracket is 33% (not 15%)?

Accepted Answer

The answer of During 2015,Jackson had the following capital gains...

Question 13

During the current year,Doris received a large gift from her parents and a sizeable inheritance from an uncle.She also paid premiums on an insurance policy on her life.Doris is confused because she cannot find any place on Form 1040 to report these items.Explain.

Accepted Answer

The answer of During the current year,Doris received a large...

Question 14

In order to claim a dependency exemption for other than a qualifying child,a taxpayer must meet the support test.Generally,this is done by furnishing more than 50% of a dependent's support.What exceptions exist,if any,where the support furnished need not be more than 50%?

Accepted Answer

The answer of In order to claim a dependency exemption...

Question 15

During 2015,Addison has the following gains and losses: LTCG $10,000 LTCL 3,000 STCG 2,000 STCL 7,000 ​
a.How much is Addison's tax liability if she is in the 15% tax bracket?
b.If her tax bracket is 33% (not 15%)?

Accepted Answer

The answer of During 2015,Addison has the following gains and...

Question 16

Under what circumstances,if any,may an ex-spouse be claimed as a dependent?

Accepted Answer

The answer of Under what circumstances,if any,may an ex-spouse be...

Question 17

In applying the gross income test in the case of dependents that are married,could the application of community property laws have any effect? Explain.

Accepted Answer

The answer of In applying the gross income test in...

Question 18

Mel is not quite sure whether an expenditure he made is a deduction for AGI or a deduction from AGI.Since he plans to choose the standard deduction option for the year,does the distinction matter? Explain.

Accepted Answer

The answer of Mel is not quite sure whether an...

Question 19

When filing their Federal income tax returns,the Youngs always claimed the standard deduction.After they purchased a home,however,they started to itemize their deductions from AGI.
a.Explain the reason for the change.
b.​
Suppose they purchased the home in November 2014,but did not start itemizing until tax year 2015.Why the delay as to itemizing?

Accepted Answer

The answer of When filing their Federal income tax returns,the...

Question 20

Lena is 66 years of age,single,and blind and is not claimed as a dependent.How much gross income must she have before she is required to file a Federal income tax return for 2015?

Accepted Answer

The answer of Lena is 66 years of age,single,and blind...

Quiz 3: Computing the Tax

Contrast the tax consequences resulting from the following filing status situations: a. Married filing jointly versus married filing separately. b. Married filing separately versus single filing separately. c.Married filing separately versus abandoned spouse status.

During 2015,Madison had salary income of $80,000 and the following capital transactions: LTCG $13,000 LTCL 15,000 STCG 13,000 STCL 6,000 How are these transactions handled for income tax purposes?

When can a taxpayer not use Form 1040EZ? Form 1040A?

The Dargers have itemized deductions that exceed the standard deduction.However,when they file their joint return,they choose the standard deduction option. a.Is this proper procedure? b.Aside from a possible misunderstanding as to the tax law,what might be the reason for the Darger's choice?

In resolving qualified child status for dependency exemption purposes,why are tiebreaker rules necessary? Can these rules be waived?

In satisfying the support test and the gross income test for claiming a dependency exemption,a scholarship received by the person being claimed is handled the same way for each test.Do you agree or disagree with this statement? Why?

Adjusted gross income (AGI) sets the ceiling or the floor for certain deductions.Explain and illustrate what this statement means.

Mr.Lee is a citizen and resident of Hong Kong,while Mr.Anderson is a citizen and resident of the U.S.In the taxation of income,Hong Kong uses a territorial approach,while the U.S.follows the global system.In terms of effect,explain what this means to Mr.Lee and Mr.Anderson.

Deductions for AGI are often referred to as "above-the-line" or "page 1" deductions.Explain.

In meeting the criteria of a qualifying child for dependency exemption purposes,when if ever,might the child's income become relevant?

During the current year,Doris received a large gift from her parents and a sizeable inheritance from an uncle.She also paid premiums on an insurance policy on her life.Doris is confused because she cannot find any place on Form 1040 to report these items.Explain.

In order to claim a dependency exemption for other than a qualifying child,a taxpayer must meet the support test.Generally,this is done by furnishing more than 50% of a dependent's support.What exceptions exist,if any,where the support furnished need not be more than 50%?

During 2015,Addison has the following gains and losses: LTCG $10,000 LTCL 3,000 STCG 2,000 STCL 7,000 a.How much is Addison's tax liability if she is in the 15% tax bracket? b.If her tax bracket is 33% (not 15%)?

Under what circumstances,if any,may an ex-spouse be claimed as a dependent?

In applying the gross income test in the case of dependents that are married,could the application of community property laws have any effect? Explain.

Mel is not quite sure whether an expenditure he made is a deduction for AGI or a deduction from AGI.Since he plans to choose the standard deduction option for the year,does the distinction matter? Explain.

Lena is 66 years of age,single,and blind and is not claimed as a dependent.How much gross income must she have before she is required to file a Federal income tax return for 2015?

Quiz 3: Computing the Tax

Contrast the tax consequences resulting from the following filing status situations: a.​ Married filing jointly versus married filing separately. b.​ Married filing separately versus single filing separately. c.Married filing separately versus abandoned spouse status.

During 2015,Madison had salary income of $80,000 and the following capital transactions: LTCG $13,000 LTCL 15,000 STCG 13,000 STCL 6,000 ​ How are these transactions handled for income tax purposes?

When can a taxpayer not use Form 1040EZ? Form 1040A?

The Dargers have itemized deductions that exceed the standard deduction.However,when they file their joint return,they choose the standard deduction option. a.Is this proper procedure? b.Aside from a possible misunderstanding as to the tax law,what might be the reason for the Darger's choice?

In resolving qualified child status for dependency exemption purposes,why are tiebreaker rules necessary? Can these rules be waived?

In satisfying the support test and the gross income test for claiming a dependency exemption,a scholarship received by the person being claimed is handled the same way for each test.Do you agree or disagree with this statement? Why?

Adjusted gross income (AGI) sets the ceiling or the floor for certain deductions.Explain and illustrate what this statement means.

Mr.Lee is a citizen and resident of Hong Kong,while Mr.Anderson is a citizen and resident of the U.S.In the taxation of income,Hong Kong uses a territorial approach,while the U.S.follows the global system.In terms of effect,explain what this means to Mr.Lee and Mr.Anderson.

Deductions for AGI are often referred to as "above-the-line" or "page 1" deductions.Explain.

In meeting the criteria of a qualifying child for dependency exemption purposes,when if ever,might the child's income become relevant?

During the current year,Doris received a large gift from her parents and a sizeable inheritance from an uncle.She also paid premiums on an insurance policy on her life.Doris is confused because she cannot find any place on Form 1040 to report these items.Explain.

In order to claim a dependency exemption for other than a qualifying child,a taxpayer must meet the support test.Generally,this is done by furnishing more than 50% of a dependent's support.What exceptions exist,if any,where the support furnished need not be more than 50%?

During 2015,Addison has the following gains and losses: LTCG $10,000 LTCL 3,000 STCG 2,000 STCL 7,000 ​ a.How much is Addison's tax liability if she is in the 15% tax bracket? b.If her tax bracket is 33% (not 15%)?

Under what circumstances,if any,may an ex-spouse be claimed as a dependent?

In applying the gross income test in the case of dependents that are married,could the application of community property laws have any effect? Explain.

Mel is not quite sure whether an expenditure he made is a deduction for AGI or a deduction from AGI.Since he plans to choose the standard deduction option for the year,does the distinction matter? Explain.

Lena is 66 years of age,single,and blind and is not claimed as a dependent.How much gross income must she have before she is required to file a Federal income tax return for 2015?

Contrast the tax consequences resulting from the following filing status situations: a. Married filing jointly versus married filing separately. b. Married filing separately versus single filing separately. c.Married filing separately versus abandoned spouse status.

During 2015,Madison had salary income of $80,000 and the following capital transactions: LTCG $13,000 LTCL 15,000 STCG 13,000 STCL 6,000 How are these transactions handled for income tax purposes?

During 2015,Addison has the following gains and losses: LTCG $10,000 LTCL 3,000 STCG 2,000 STCL 7,000 a.How much is Addison's tax liability if she is in the 15% tax bracket? b.If her tax bracket is 33% (not 15%)?