Exemptions Flashcards
In 2014, Smith, a divorced person, provided over onehalf the support for his widowed mother, Ruth, and his son, Clay, both of whom are US citizens. During 2014, Ruth did not live with Smith. She received $9,000 in social security benefits. Clay, a full-time graduate student, and his wife lived with Smith. Clay had no income but filed a joint return for 2014, owing an additional $500 in taxes on his wife’s income. How many exemptions was Smith entitled to claim on his 2014 tax return? a. 4 b. 3 c. 2 d. 1
(c) The requirement is to determine the number of exemptions that Smith was entitled to claim on his 2014 tax return. Smith will be allowed one exemption for himself and one exemption for his dependent mother. Smith is entitled to an exemption for his mother because he provided over half of her support, and her gross income ($0) was less than $3,950.
Jim and Kay Ross contributed to the support of their two children, Dale and Kim, and Jim’s widowed parent, Grant. For 2014, Dale, a twenty-year-old full-time college student, earned $4,500 from a part-time job. Kim, a twenty-three-year-old bank teller, earned $18,000. Grant received $5,000 in dividend income and $4,000 in nontaxable social security benefits. Grant, Dale, and Kim are US citizens and were over one-half supported by Jim and Kay. How many exemptions can Jim and Kay claim on their 2014 joint income tax return? a. Two b. Three c. Four d. Five
b) The requirement is to determine how many exemptions Jim and Kay can claim on their 2014 joint income tax return. Jim and Kay are entitled to one personal exemption each on their joint return. They also are entitled to one exemption for their son, Dale, since he is a qualifying child (i.e., Dale did not provide more than half of his own support, and Dale is a full-time student under age twentyfour). However, no dependency exemptions are available for Kim and Grant. Kim is not a qualifying child because she is at least age 19 and not a full-time student, and she is not a qualifying relative because her gross income was at least $3,950. Similarly, Grant is not a qualifying relative because his gross income was at least $3,950.
Which one of the following is not included in determining the total support of a dependent?
a. Fair rental value of dependent’s lodging.
b. Medical insurance premiums paid on behalf of the dependent.
c. Birthday presents given to the dependent.
d. Nontaxable scholarship received by the dependent.
(d) The requirement is to determine which item is not included in determining the total support of a dependent. Support includes food, clothing, FMV of lodging, medical, recreational, educational, and certain capital expenditures made on behalf of a dependent. Excluded from support is life insurance premiums, funeral expenses, nontaxable scholarships, and income and social security taxes paid from a dependent’s own income.
- Joe and Barb are married, but Barb refuses to sign a 2014 joint return. On Joe’s separate 2014 return, an exemption may be claimed for Barb if a. Barb was a full-time student for the entire 2014 school year. b. Barb attaches a written statement to Joe’s income tax return, agreeing to be claimed as an exemption by Joe for 2014. c. Barb was under the age of nineteen. d. Barb had no gross income and was not claimed as another person’s dependent in 2014.
d) The requirement is to determine the requirements which must be satisfied in order for Joe to claim an exemption for his spouse on Joe’s separate return for 2014. An exemption can be claimed for Joe’s spouse on Joe’s separate 2014 return only if the spouse had no gross income and was not claimed as another person’s dependent in 2014.
Al and Mary Lew are married and filed a joint 2014 income tax return in which they validly claimed the $3,950 personal exemption for their dependent seventeen-year-old daughter, Doris. Since Doris earned $5,400 in 2014 from a part-time job at the college she attended full-time, Doris was also required to file a 2014 income tax return. What amount was Doris entitled to claim as a personal exemption in her 2014 individual income tax return? a. $0 b. $1,000 c. $3,900 d. $5,400
a) The requirement is to determine the amount of personal exemption on a dependent’s tax return. No personal exemption is allowed on an individual’s tax return if the individual can be claimed as a dependency exemption by another taxpayer.
During 2014 Robert Moore, who is fifty years old and unmarried, maintained his home in which he and his widower father, age seventy-five, resided. His father had $4,700 interest income from a savings account and also received $2,400 from social security during 2014. Robert provided 60% of his father’s total support for 2014. What is Robert’s filing status for 2014, and how many exemptions should he claim on his tax return? a. Head of household and two exemptions. b. Single and two exemptions. c. Head of household and one exemption. d. Single and one exemption.
d) The requirement is to determine Robert’s filing status and the number of exemptions that he should claim. Robert’s father does not qualify as Robert’s dependent because his father’s gross income (interest income of $4,700) was not less than $3,950. Social security is not included in the gross income test. Since his father does not qualify as his dependent, Robert does not qualify for head-of-household filing status. Thus, Robert will file as single with one exemption.
John and Mary Arnold are a childless married couple who lived apart (alone in homes maintained by each) the entire year 2014. On December 31, 2014, they were legally separated under a decree of separate maintenance. Which of the following is the only filing status choice available to them when filing for 2014? a. Single. b. Head of household. c. Married filing separate return. d. Married filing joint return.
(a) The requirement is to determine the filing status of the Arnolds. Since they were legally separated under a decree of separate maintenance on the last day of the taxable year and do not qualify for head-of-household status, they must each f ile as single. 160. (a) Mr. and Mrs. Stoner are entitled to one exemption each. They are entitled to one exemption
