Which of the following statements regarding exemptions is correct?
A) Personal exemptions are more valuable than dependency exemptions.
B) Taxpayers filing a married filing joint return are limited to two exemptions on their tax returns.
C) Exemption amounts are considered to be for AGI deductions.
D) Taxpayers subtract exemption deductions from adjusted gross income in determining taxable income.

Question

Quizplus · Accepted Answer

Taxpayers subtract exemption deductions from their adjusted gross income in determining their taxable income. Personal exemptions and dependency exemptions are types of exemptions, and the amount of exemption is subtracted from the taxable income of taxpayers. Exemption amounts are not considered to be for AGI deductions, and taxpayers filing a married filing joint return can have more than two exemptions. Therefore, option D is the correct statement.

Which of the Following Statements Regarding Exemptions Is Correct