ACC 124 - Test 1 Flashcards
1
Q
Tax Formula
A
Gross Income
Less: Deductions for AGI
——————————————————
AGI
Less: Standard / Itemized Deductions
Less: Exemptions
——————————————————-
Taxable Income
x Tax Rates
——————————————————-
Tax
2
Q
Itemized Deductions Filing Status
A
- Single ($6,100)
- Married Filing Joint ($12,200)
- In case of spouse death, still file MFJ in year of death
- Married Filing Single ($6,100)
- Head of Household ($8,950)
- Qualifying Widow ($12,200
3
Q
Head of Household Requirements
A
- Abandoned or unmarried
- Must pay greater than half of the cost of a current home for you and your dependent
Exception: Filing party pays for more than half of a parent’s home
4
Q
Qualifying Widow Requirements
A
- Must pay over half the cost of house for you and your child
- Only claim for the 2 years following the year of the spouse’s death
5
Q
Taxable Income Standard Deduction Additions
A
For each instance, not either or,
- *65 and over
- *Medical Blindness
- $1,200 (Married or Widow)
- $1,500 (Single or HOH)
- *Dependent
- Greater of $1,000 OR earned income + $350
6
Q
Exemptions
A
-$3,900 per person (Personal or Dependent Exemptions)
7
Q
Two Types of Dependent Exemptions
A
- Qualifying Child
2. Qualifying Relative
8
Q
Qualifying Child Tests
A
- Relationship Test
- Domicile (7 1/2 year)
- Age (<24 if F-T student)
- Joint Return
- Citizenship
- Self-Support
9
Q
Qualifying Relative Tests
A
- Relationship of member of household
- Gross Income ($3,900)
- Support
- Joint Return
- Citizenship
10
Q
Who Must File
A
If your income is greater than the Standard Deduction + Exemption amount
11
Q
Gross Income
A
- Definition- Any income from whatever source derived
- Interest Dividends
–>Included - Alimony
–>Included
(Deducted if the one paying) - Prizes and Awards
–>Include - Annuities / Pensions
- Life Insurance Proceeds
–>Exclude - Gifts and Inheritance
–>Exclude - Scholarships
–>Include for Room and Board
–>Exclude for Tuition, Fees, Books, Etc - Accident and Health Premiums
–>Exclude - Meals and Lodging
- Municipal Bond
–> Exclude - Unemployment
–>Include - Employee Fringe Benefit
- Social Security Benefits
12
Q
Alimony
A
- Cash and received by ex-spouse
- Divorce Decree
- Cannot continue after death
- Cannot be anything other than alimony
- Not members of the same home
13
Q
Prizes and Awards Exception
A
Employer award for safety or length of service
Max is $400
14
Q
Meal Exclusions
A
If:
- Provided by employer
- On premises
- During working hours
- For benefit of employer
15
Q
Lodging Exclusions
A
If:
- Provided by employer
- Condition of employment
