Ch 3 - Terms (Dependent Exemptions and Support)

Question 1

Custodial Parent

Answer 1

The parent with whom a whild lived for the greater number of nights during the year.

Question 2

Dependent

Answer 2

An individual whose personal exemption may be claimed on another person’s income tax return. To be claimed as a dependent, a person must meet certain tests.

Question 3

Eligible Foster Child

Answer 3

A child, other than the taxpayer’s biological child, stepchild, or adopted child, who was placed with the taxpayer by an authorized placement agency or by a court order, decree, or judgment.

Question 4

Full-time Student

Answer 4

An individual who is enrolled in a school for the number of hours or courses considered by the school to be full time. School includes elementary and secondary schools, post-secondary colleges, and technical and trade schools. It does not include on-the-job training, correspondence schools, or night school. However, a student will not be disqualified by night classes that are part of a full-time course of study.

Question 5

Multiple Support Agreement

Answer 5

If two or more persons who would otherwise be entitled to an exemption for a qualifying relative together furnish more than half the dependent’s support (but no individual provides more than half), any one of them who furnishes more than 10% of the support is entitled to the exemption if all the others who furnished more than 10% of the support file written declarations that they will not claim an exemption for the individual for that taxable year. Form 2120 is used for this purpose

Question 6

Noncustodial Parent

Answer 6

The parent who is not the custodial parent of the child.

Question 7

Permanent and Total Disability

Answer 7

A disability that prevents an individual from engaging in any substantial gainful activity because of a medically determined physical or mental impairment that is expected to result in death, or has lasted or is expected to last for a continuous period of not less than 12 months.

Question 8

Physical Custody

Answer 8

The taxpayer with whom a child lives is considered to have physical custody, regardless of who has nominal legal custody.

Question 9

Principal Place of Abode (Principal Residence)

Answer 9

The place that an individual consideres h is permanent home. A person’s abode does not change when he is temporarily absent due to illness, school, military service, etc, as long as his living area is maintained and he can reasonably be expected to return home after the absence.

Question 10

Qualifying Child (QC)

Answer 10

A child who meets the relationship, age, residency, support, joint return, and the special tests with regard to a taxpayer to determine the taxpayer’s eligibility to claim the dependency exemption, Child Tax Credit, Earned Income Credit, or Child and Dependent Care Credit with regard to the child, or to use the HoH filing status.

Question 11

Qualifying Relative (QR)

Answer 11

A person (1) who bears a certain relationship to the taxpayer, (2) for whom the taxpayer provides more than one-half support for the year, (3) whose gross income for the year is less than the exemption amount, and (4) who is not claimed as a QC of any taxpayer.

Question 12

Support

Answer 12

The total amount provided on behalf of an individual. Support includes food, lodging, and other necessities, as well as recreation and other nonessential expenditures. Support is not limited to necessities and can be as lavish as the taxpayer can afford.

Question 13

Fair Rental Value

Answer 13

The amount the owner of property could reasonably expect to receive from a stranger for the same type of lodging. Generally, the amount at which a home with its furnishings could be rented to a similar size family in a similar location.

Question 14

EITC

Answer 14

Earned Income Tax Credit

Question 15

AOTC

Answer 15

American Opportunity Tax Credit

Question 16

CTC

Answer 16

Child Tax Credit

Question 17

ACTC

Answer 17

Additional Child Tax Credit