Question

1.Priscilla (35) is divorced from Bernardo (40). They are the parents of Sal (12). Sal lives with his mother who pays over half the cost of maintaining the home. The divorce decree gives Bernardo the unconditional right to claim the dependency exemption for Sal. Sal meets all of the tests for dependency for Priscilla for qualifying child. What is Priscilla's most advantageous filing status for 2018?

A. Single.

B. Head of household.

C. Married filing jointly.

D. Married filing separately.

2. Beatrice, Hazel, Cleo, and John are all siblings. Between them they provide 100% of the support for their mother, each of them contributes the following amounts: Beatrice - 45% $13,500. Hazel - 35% $10,500. Cleo - 10% $3,000. John - 10% $3,000. Who may claim the dependent exemption for their mother?

A. Beatrice and Hazel may split the dependent exemption.

B. They must decide between the four of them who will claim the dependent exemption. The others must sign a statement agreeing not to take an exemption for their mother.

C. Only Beatrice may claim the dependent exemption, as she paid the most toward their mother's support.

D. Either Beatrice or Hazel may claim the dependent exemption. The other must sign a statement agreeing not to take an exemption for their mother.

3. Which of the following taxpayers might benefit from filing Form 8379, Injured Spouse Allocation?

A. Claude misrepresented the amount of tax withheld when he filed a joint return with his wife, Claudia.

B. Jennifer and Mike file a joint return which results in a refund that includes refundable credits. Jennifer earned $39,000. Mike was a stay-at-home dad and had no earned income. Mike owes back child support.

C. Bud has earned income and files a joint return with his wife, Jean. Jean did not work in 2018. Their joint return results in a refund that is not dependent on any refundable credits. Bud owes $4,700 in delinquent student loan payments.

D. Tim and Mary Ann file a joint return that results in a refund that includes refundable credits. Both had earned income. Tim was married before and bought a car for his ex-wife. He is behind on those payments.

4. What does Injured Spouse relief allow?

A. A taxpayer to take the refund of another taxpayer in satisfaction of their alimony payment.

B. Spouses to file married filing separately so that the injured spouse can get their share of the tax refund.

C. Personal injury claims to be excluded from gross income.

D. A couple to file jointly, but only have certain debts (i.e. child support and past-due taxes) taken from the refund of the spouse responsible for the liability.

Answer 1

1)

Option B

Since Priscilla is divorced and laying for more than half of maintenance of her child (below 18 age). She can claim the the standard deduction applicable to Head of household

2)

Option D

When a parent's expense is paid by two or more children and none of them pay more than 50%, then that child (only one) of them who are paying more than 10% is eligible to claim the dependency exemption while the other child (s) paying more than 10% shoudl file statement agreeing not to take exemption

3)

Option B

Form 8379 can be filed if we meet the following

A. Injured spouse is not liable for past due

B. Injured spouse made payments like federal tax or claimed earned income credit

C. He/She must have filed joint return

4)

Option D

Injured spouse relief allows the injured spouse refund to be intact and not be liable for the payment of the past due of his/her spouse.