Question 1

Atlas earned $17,300 from his sole proprietorship in 2018.This was his only source of income.How much in self-employment taxes will Atlas be able to deduct?

Accepted Answer

The answer of Atlas earned $17,300 from his sole proprietorship...

Question 2

Wolfina's twins,Romulus and Remus,finished their first year of school at an accredited university in 2018.She paid $10,000 in qualified educational expenses for Romulus and $2,000 of qualifying expenses for Remus.Wolfina is a head of household with an AGI of $85,000.What amount of American opportunity credit may she claim?

Accepted Answer

The answer of Wolfina's twins,Romulus and Remus,finished their first year...

Question 3

Demeter is a single taxpayer.Her AGI in 2018 is $209,200.Demeter may claim a child tax credit for her daughter Persephone.What amount of child tax credit is Demeter entitled to claim after any applicable phase-out?

Accepted Answer

The answer of Demeter is a single taxpayer.Her AGI in...

Question 4

Clarissa's gross tax liability for 2018 is $1,300.She has a $1,500 nonrefundable personal tax credit,a $750 business tax credit,and a $400 refundable personal tax credit.Her employer withheld $1,000 from her pay for taxes.What is her net tax due or refund for this year?

Accepted Answer

The answer of Clarissa's gross tax liability for 2018 is...

Question 5

Keith and Nicole are married filing joint with two daughters who qualify as dependents.Their gross income for 2018 is $25,500.Are they required to file a tax return? How do you know this without memorizing the gross income thresholds? In 2018,the standard deduction for taxpayers filing a joint return is $24,000.

Accepted Answer

The answer of Keith and Nicole are married filing joint...

Question 6

Johann had a gross tax liability of $22,508 in 2018,but his employer only withheld taxes of $19,500.Johann's gross tax liability was $21,000 in 2017.Calculate Johann's under/overpayment in each quarter for 2018 tax purposes.

Accepted Answer

The answer of Johann had a gross tax liability of...

Question 7

Akiko and Hitachi (married filing jointly for 2018)are both educators.They attended a conference to further their job-related skills.Tuition for the conference was $2,000 for each person.Their AGI was $120,000.How much lifetime learning credit can they claim?

Accepted Answer

The answer of Akiko and Hitachi (married filing jointly for...

Question 8

Julien and Sarah are married,file a joint return,and have two children,Kaya and Christopher.Kaya just finished her third year at college and Christopher just finished his first year of graduate school (fifth year of college).Tuition and books for the past year were $1,800 for Kaya and $5,000 for Christopher.How much can Julien and Sarah claim in educational credits if their joint AGI was $126,000 for 2018?

Accepted Answer

The answer of Julien and Sarah are married,file a joint...

Question 9

Jack paid $5,000 in daycare expenses for his five-year-old daughter so he could work.His AGI for the year was $37,500 (all earned income).What is the amount of his child and dependent care credit?

Accepted Answer

The answer of Jack paid $5,000 in daycare expenses for...

Question 10

During all of 2018,Mr.and Mrs.Clay lived with their four children (all are under the age of 17).They provided over one-half of the support for each child.Mr.and Mrs.Clay file jointly for 2018.Neither is blind,and both are under age 65.They reported the following tax-related information for the year: (Use the tax rate schedules)
 $\begin{array} { l r } 
\text { Salary incorne } & \$ 125,000 \
\text { Prize from local radio station } & 1,500 \
\text { Medical expenses (no health insurance) } & 4,000 \
\text { Real estate taxes } & 4,200 \
\text { Alirnory paid by Mr. Clay (divorced in 2015) } & 12,000 \
\text { State incorne taxes withheld in } 2018 & 1,800 \
\text { State income taxes paid with } 2018 \text { tax return (return was filed in April, } & \
\text { 2019) } & 1,500 \
\text { Federal incorne tax withholdine } & 7,500 \
\text { Qualified horne mortgage interest (acquisition debt of } \$ 300,000 \text { ) } & 15,000 \
\text { Charitable contributions } & 4,000
\end{array}$ A.What is the Clays' taxes payable or (refund due)(ignore the alternative minimum tax)?
B.What is the Clays' tentative minimum tax and alternative minimum tax?

Accepted Answer

The answer of During all of 2018,Mr.and Mrs.Clay lived with...

Question 11

Sam is 30 years old.In 2018,he reported an AGI of $12,000,all from his job as a server at the local café.He is single and has no dependents.What amount of earned income credit may he claim in 2018? Use Exhibit 8-10

Accepted Answer

The answer of Sam is 30 years old.In 2018,he reported...

Question 12

Assume Georgianne underpaid her estimated tax liability by $150 in the first quarter,$500 in the second quarter,$400 in the third quarter,and $200 in the fourth quarter.Calculate her underpayment penalty for the year,assuming the federal short-term interest rate is five percent.

Accepted Answer

The answer of Assume Georgianne underpaid her estimated tax liability...

Question 13

In 2018,Shawn's AGI is $170,000.He earned the income evenly throughout the year.He owed $29,890 in federal income tax and self-employment taxes of $2,590.Last year,he had a gross tax liability of $50,000.What is the minimum quarterly estimated tax payment Shawn must pay each quarter to avoid underpayment penalties for 2018?

Accepted Answer

The answer of In 2018,Shawn's AGI is $170,000.He earned the...

Question 14

In 2018,John (52 years old)files as a head of household with one 18-year old dependent (qualifying)child.John is eligible to claim a $700 American opportunity credit for the year.John did not have any taxes withheld by his employer during the year and he did not make any estimated tax payments.After taking credits into account,what is the amount of John's taxes payable or refund assuming that his AGI is $26,000 (all from salary)and his taxable income is $8,000?

Accepted Answer

The answer of In 2018,John (52 years old)files as a...

Quiz 7: Individual Income Tax Computation and Tax Credits