Filing Requirements Flashcards
When preparing a current-year tax return, which of the following benefits are derived from the use of the previous year’s return?
I. Prevents gross mathematical errors
II. Identifies significant changes
III. Increases efficiency
A. I and II only.
B. I and III only.
C. II and III only.
D. I, II, and III.
I, II, and III.
Answer (D) is correct.
Use of the prior-year return helps to prevent gross mathematical errors or identify significant changes. The accuracy of the prior-year return increases efficiency in completing the current-year return. These are just a few of the benefits of obtaining a copy of the previous year’s return (Publication 17).
Which taxpayer information is necessary to have before preparing a tax return?
A. Immigration status.
B. Age of an individual.
C. Marital status.
D. All of the information is needed.
All of the information is needed.
Answer (D) is correct.
Taxpayer biographical information (e.g., date of birth, age, marital status, dependents, etc.) is used to verify the identity of the taxpayer and related dependents. The age of an individual determines if (s)he qualifies for additional deductions (65 and over), retirement distributions, dependency, etc. MFJ status often increases beneficial dollar limits for deductions and credits. If a taxpayer is an alien (not a U.S. citizen), (s)he is considered a nonresident alien, unless either the green card test or the substantial presence test for the calendar year is met.
All of the following are nondeductible expenses EXCEPT
A. Rent and insurance premiums paid for the taxpayer’s own dwelling.
B. Life insurance premiums paid by the insured.
C. Ordinary and necessary business expenses.
D. Payments for food.
Ordinary and necessary business expenses.
Answer (C) is correct.
A personal, living, or family expense is not deductible unless the Code specifically provides otherwise. Nondeductible expenses include rent and insurance premiums paid for the taxpayer’s own dwelling; life insurance premiums paid by the insured; payments for food, clothing, domestic help, and upkeep of an automobile; and personal interest. Ordinary and necessary business expenses, which are the costs of carrying on a trade or business, are deductible if the business is operated to make a profit.
Which items from the prior-year return may be needed to complete the current-year return? I. State income tax refund II. AMT for credit III. AGI IV. Gain (loss) carryover
A. I and II only.
B. II and IV only.
C. I, II, and IV.
D. I, II, III, and IV.
I, II, and IV.
Answer (C) is correct.
Certain items from the prior year return may be needed to complete the current-year return [state income tax refund, AMT for credit, gain (loss) carryover, charitable gift carryover, etc.].
All of the following income types are reported on Form 1099-MISC EXCEPT
A. Nonemployee compensation over $600.
B. Payments made to a physician or supplier or provider of medical or healthcare services of $600 or more made in the course of your trade or business.
C. Canceled debt payments of $600 or more.
D. Crop insurance proceeds of $600 or more.
Canceled debt payments of $600 or more.
Answer (C) is correct.
Form 1099-MISC, Miscellaneous Income, is used for reporting a variety of types of income that are not reported on a W-2 or other specific Form 1099, that are made in the course of a trade or business, and for which the taxpayer paid during the year
At least $10 in royalties or broker payments in lieu of dividends or tax-exempt interest or
At least $600, e.g., in medical and healthcare payments or crop insurance proceeds.
Form 1099-C, Cancellation of Debt, is utilized for canceled debt payments of $600 or more.
Upon reviewing a new client’s prior year tax return, the preparer sees taxes paid for the First-Time Homebuyer Credit. The preparer should ask the taxpayer all of the following EXCEPT
A. What was the total amount of the original credit
received?
B. How much of the original credit was repaid on prior years’ returns?
C. Was the entire credit used towards the purchase of their main home?
D. Are the taxpayers still using the home that generated the credit as their main home?
Was the entire credit used towards the purchase of their main home?
Answer (C) is correct.
Between April 8, 2008, and May 1, 2010, a credit for qualifying first-time homebuyers was available. Taxpayers who claimed it in 2008 and experience situations which include but are not limited to the following are required to repay the credit over 15 years:
1. The taxpayer sold the home (including through foreclosure);
2. The taxpayer converted the entire home to business or rental property;
3. The taxpayer abandoned the home (except in connection with a sale or foreclosure);
4. The home was destroyed, condemned, or disposed of under threat of condemnation; or
5. The taxpayer who claimed the credit died in 2019.
Form 5405, Repayment of the First-Time Homebuyer Credit, is used by taxpayers to notify the IRS that the home the taxpayer purchased in 2008 and for which the credit was claimed has been disposed of or ceased to be the taxpayer’s. Questions regarding the use of the credit are not addressed per Form 5405.
Which of the following is true regarding the Report of Foreign Bank and Financial Accounts (FBAR) requirements?
A. The FinCEN Form 114 (FBAR) must be filed by anyone with a financial interest in or signature authority over a foreign bank account.
B. The due date for the FBAR filing is generally July 15 of the current tax year for individuals.
C. The FinCEN Form 114 (FBAR) is filed with your current tax year individual income tax return.
D. The FinCEN Form 114 (FBAR) is filed online with the Financial Crimes Enforcement Network.
The FinCEN Form 114 (FBAR) is filed online with the Financial Crimes Enforcement Network.
Answer (D) is correct.
FinCEN Form 114, Report of Foreign Bank and Financial Accounts, is filed online with the Financial Crimes Enforcement Network.
When e-filing their federal return, a taxpayer who meets the requirements to file both Form 8938, Statement of Specified Foreign Financial Assets, and Form 114, Report of Foreign Bank and Financial Accounts, should
A. Attach both forms to their federal return.
B. Attach only the Form 8938 to their federal return and file the Form 114 through the Financial Crimes Enforcement Network’s e-filing system.
C. Attach only the Form 114 to their federal return as it contains the 8938 information.
D. Send both forms in separately to the Internal Revenue Service.
Attach only the Form 8938 to their federal return and file the Form 114 through the Financial Crimes Enforcement Network’s e-filing system.
Answer (B) is correct.
Certain domestic corporations, partnerships, and trusts that are considered formed or availed of for the purpose of holding, directly or indirectly, specified foreign financial assets (specified domestic entities) must file Form 8938 if the total value of those assets exceeds $50,000 on the last day of the tax year or $75,000 at any time during the tax year. Attach Form 8938 to your annual return and file by the due date (including extensions) for that return.
The Treasury Department’s Financial Crimes Enforcement Network (FinCEN) requires a FinCEN Form 114 [ Report of Foreign Bank and Financial Accounts (FBAR)] to be filed by taxpayers who had an interest in or signature or other authority over a financial account located outside the U.S., such as a bank, securities, or other financial account, or owned more than 50% of the stock of a corporation that owns one or more bank accounts located outside the U.S. FinCEN Form if (1) the aggregate value of all foreign accounts is $10,000 or less at all times during the year or (2) the accounts are at a U.S. military banking facility. FinCEN Form 114 is not attached to Form 1040. Instead, it must be filed on a calendar-year basis, electronically, using the Bank Security Act (BSA) e-filing system. The FBAR due date is April 15. A 6-month extension is allowed.
The requirement to file the FinCEN Form 114 applies to U.S. persons with a financial interest in or signature authority over any foreign financial account(s), if the aggregate value of these accounts, at any time during the calendar year, exceeds
A. $1,000
B. $5,000
C. $7,500
D. $10,000
$10,000
Answer (D) is correct.
FinCEN Form is not required if (1) the aggregate value of all foreign accounts is $10,000 or less at all times during the year or (2) the accounts are at a U.S. military banking facility.
John and Linda Smith are a childless married couple with no other dependents who lived apart for all of the current year. On December 31 of the current year, they were legally separated under a decree of separate maintenance. Based on the facts, which of the following is the only filing-status choice available to them for the current year?
A. Married filing joint return.
B. Married filing separate return.
C. Head of household.
D. Single.
Single.
Answer (D) is correct.
The determination of whether an individual is married is made as of the close of the taxable year, so John and Linda are both single for the current year (Publication 17). Couples under a separate maintenance agreement are not considered married.
Which of the following is NOT a requirement that must be met in determining whether a taxpayer is considered unmarried for head of household filing-status purposes?
A. An individual must file a separate return.
B. An individual must pay more than one-half the cost of keeping up a home for the tax year.
C. An individual’s home must be, for the entire year, the main home of his or her child, stepchild, or qualified foster child whom (s)he or the noncustodial parent can properly claim as a dependent.
D. An individual’s spouse must not have lived in their home for the last 6 months of the tax year.
An individual’s home must be, for the entire year, the main home of his or her child, stepchild, or qualified foster child whom (s)he or the noncustodial parent can properly claim as a dependent.
Answer (C) is correct.
In determining if a taxpayer qualifies for head of household filing status, the taxpayer is considered unmarried if all the following requirements are met:
1. The taxpayer filed a separate return.
2. The taxpayer paid more than half the cost of keeping up the home for the tax year.
3. The taxpayer’s spouse did not live in the home during the last 6 months of the tax year.
4. The home was, for more than half the year, the main home of the taxpayer’s child, stepchild, or adopted child whom the taxpayer or the noncustodial parent can properly claim as a dependent.
5. The taxpayer must be able to claim the child as a dependent.
Therefore, this answer is correct because the requirement is that the home be the main home of the child, stepchild, or qualified foster child for more than half the year, not the entire year [Publication 17 and Sec. 2(b)].
In 2019, Lisa was married and had two dependent children. Her husband died in April, and she did not remarry before the end of 2019. Which filing status should Lisa use for her tax return in 2019?
A. Single.
B. Married Filing Jointly.
C. Head of Household.
D. Qualifying Widow(er) with Dependent Child.
Married Filing Jointly.
Answer (B) is correct.
Two individuals are treated as legally married (Publication 504) for the entire tax year if, on the last day of the tax year, they are
1. Legally married and cohabiting as husband and wife
2. Legally married and living apart but not separated pursuant to a valid divorce decree or separate maintenance agreement
3. Separated under a valid divorce decree that is not yet final
If a spouse dies, status is determined when the spouse dies unless the surviving spouse remarries before the end of the tax year (Publication 17).
All of the following are requirements to claim head of household filing status EXCEPT
A. You are unmarried or considered unmarried on the last day of the year.
B. Your spouse did not live in your home during the last 6 months of the tax year.
C. Your parent must live in your home at least 6 months.
D. You paid more than half of the cost of keeping up your house for the entire year.
Your parent must live in your home at least 6 months.
Answer (C) is correct.
A taxpayer with a dependent parent may qualify for head of household status even if the parent does not live with the taxpayer, provided that the taxpayer pays more than half the cost of maintaining the main home for the parent. (Publication 17.)
Joe is 37 years old. His wife died during the tax year, and he has not remarried. His deceased wife had no income. He has two minor children living with him. Joe paid all of the costs for keeping up his home for the tax year, and he has paid for all of the support of his wife and these children. The filing status with the lowest tax rate for which Joe qualifies is
A. Qualifying widower with dependent child.
B. Married filing separately.
C. Head of household.
D. Married filing jointly.
Married filing jointly.
Answer (D) is correct.
Publication 501 states, “If your spouse died during the year, you are considered married for the whole year for filing status purposes. If you didn’t remarry before the end of the tax year, you can file a joint return for yourself and your deceased spouse. For the next 2 years, you may be entitled to the special benefits described later under Qualifying Widow(er)” (Publication 17).
For 2019, Jane is unmarried and paid more than half the cost of keeping up her home. All of the following dependents would qualify Jane to file as head of household EXCEPT
A. Jane’s grandson, who lived with her but was absent from her home for 9 months in 2019 while attending boarding school.
B. Jane’s father, whom she can claim as a dependent and whose main home for 2019 was a home for the elderly for which Jane paid more than one-half the cost.
C. Jane’s married son, who could properly be claimed as a dependent on his father’s return only.
D. Jane’s sister, whom Jane can claim as a dependent and who lived with Jane until she died in May 2019.
Jane’s married son, who could properly be claimed as a dependent on his father’s return only.
Answer (C) is correct.
A taxpayer qualifies for head of household filing status if (s)he is not married or is considered unmarried at the close of the tax year, is not a surviving spouse, and maintains a household that is also the principal place of abode for more than half of the year for any one of certain qualifying individuals.
A married son, stepson, daughter, or stepdaughter is a qualifying individual only if the taxpayer is entitled to claim the person as a dependent or the taxpayer by written declaration allows the noncustodial parent to claim the person as a dependent.
Jane must have been able to claim the married son as a dependent in order to qualify as head of household.
Milton is 39 years old. He is divorced from his wife since March 1 of the tax year. They have two minor children. One child lives with Milton, and the other child lives with the mother. The children have been with their respective parents from March through December of the tax year. Milton provides all of the support for the minor child living with him. The filing status with the lowest rate that Milton qualifies for is
A. Married filing separately.
B. Single.
C. Head of household.
D. Married filing jointly.
Head of household.
Answer (C) is correct.
The determination of whether an individual is married is made as of the close of the taxable year, so Milton is deemed unmarried for the tax year. Milton is not a surviving spouse, and the tax rates for a head of household are lower than those for a single taxpayer. In determining if a taxpayer qualifies for head of household filing status, the taxpayer is considered unmarried if all the following requirements are met:
1. The taxpayer filed a separate return.
2. The taxpayer paid more than half the cost of keeping up the home for the tax year.
3. The taxpayer’s spouse did not live in the home during the last 6 months of the tax year.
4. The home was, for more than half the year, the main home of the taxpayer’s child, stepchild, or adopted child whom the taxpayer or the noncustodial parent can properly claim as a dependent.
Therefore, the filing status with the lowest rate that Milton qualifies for is head of household (Publication 17).
Who would NOT be a qualifying person for purposes of filing as head of household in 2019?
A. Your mother, whom you can claim as a dependent.
B. Your adopted child who lives with you, is married, and can be claimed as your dependent.
C. Your foster child who lived with you all year and is your dependent.
D. Your aunt, related to you by blood. She does not live with you but is your dependent.
Your aunt, related to you by blood. She does not live with you but is your dependent.
Answer (D) is correct.
The taxpayer must maintain a household that constitutes the principal place of abode for more than half of the taxable year for at least one qualifying individual who is
An unmarried son or daughter, unmarried grandchild, or unmarried stepchild, or
Any other relative eligible to be claimed as a dependent, except for those eligible under a multiple-support agreement.
Thus, your aunt, who is your dependent, would not be a qualifying individual because she does not live in the principal place of abode (Publication 17).
Phil is unmarried in 2019. His dependent daughter, Susan, lived with him all year. Property taxes of $2,500 and mortgage interest of $5,000 on the home where he and Susan live are divided equally with his ex-wife. Phil paid the utilities of $200 per month. What amount may Phil use as the costs of keeping up a home to qualify for head of household filing status?
A. $6,150
B. $4,950
C. $3,750
D. $9,900
$6,150
Answer (A) is correct.
An individual must maintain a household that is the principal place of abode for a qualifying individual. To maintain a household for federal filing status purposes, an individual must furnish more than 50% of the costs of maintaining the household during the tax year. Qualifying expenditures include property tax, mortgage interest, rent, utilities, upkeep, repair, property insurance, and the food consumed on the premises (Publication 17).
Phil pays 50% of the property taxes and mortgage interest, as well as 100% of the utilities. Since all of these are qualified expenditures, he may use the amounts he paid for purposes of determining if he furnished more than 50% of the costs of maintaining the household. Thus, the amount that Phil may use as the costs of keeping up a home to qualify for head of household filing status is $6,150 [($5,000 mortgage interest × 50%) + ($2,500 property taxes × 50%) + ($200 utilities × 12 months)].
Matt has a certified statement from his optometrist on December 1, 2019, that confirms he can see no better than 20/250. For tax year 2019, which is correct?
A. Matt is not eligible for the additional standard deduction for blindness as he is only partially blind.
B. Matt is eligible for the additional standard deduction for blindness in 2019.
C. Matt is eligible for the additional standard deduction for blindness in 2019, the first full year of his blindness.
D. Matt is not eligible for the additional standard deduction for blindness as he can see better than 20/300.
Matt is eligible for the additional standard deduction for blindness in 2019.
Answer (B) is correct.
A taxpayer who has vision of 20/200 is considered legally blind for federal tax purposes. Married taxpayers who are legally blind are entitled to an additional standard deduction of $1,300 ( $1,650 for those whose filing status is unmarried or head of household). Thus, Matt is entitled to the additional deduction (Publication 501).
Ms. N, who is married, wants to file as head of household for the current year. Which of the following will prevent her from filing as head of household?
A. Her spouse lived in her home for the final 6 months of the current year.
B. She and her husband did not commingle funds for support purposes.
C. She paid more than half the cost of keeping up her home for the tax year.
D. Her home was, for more than 6 months of the year, the principal home of her son, whom she can claim as a dependent.
Her spouse lived in her home for the final 6 months of the current year.
Answer (A) is correct.
A married person may qualify for head of household status if the conditions for “considered unmarried” are met. A married individual who lives with a dependent apart from the spouse will be considered unmarried and qualify for head of household status if, for the tax year, (1) the individual files separately; (2) the individual pays more than 50% toward maintaining the household; (3) the spouse is not a member of the household for the last 6 months; (4) the household is the principal home of the individual’s child, stepchild, or qualified foster child for more than half the year; and (5) the individual can claim the child as a dependent.
Malcolm and Glenda were married, but they got divorced on June 1 of the current year. Their one minor child lived with Glenda all of the year. Glenda worked all year and provided more than half the cost of keeping up the home for herself and her minor child. Glenda signed Form 8332, Release of Claim to Exemption for Child of Divorced or Separated Parents, allowing Malcolm to claim their child as his dependent on his separately filed return. Glenda’s proper filing status is
A. Single.
B. Married filing jointly.
C. Married filing separately.
D. Head of household.
Head of household.
Answer (D) is correct.
The determination of whether an individual is married is made as of the close of the taxable year, so Glenda is unmarried. Glenda is not a surviving spouse, and the tax rates for a head of household are lower than those for a single taxpayer. To qualify for head of household rates, she must maintain (furnish over half the cost of) a household as her home that is also the domicile of her unmarried child, and she must be entitled to the dependency exemption for the child [Sec. 2(b)]. Glenda is allowed to grant the exemption to the other parent [Publication 17 Chapter 2 Head of Household (considered unmarried items)]. Glenda meets these requirements for head of household status.
For federal income tax purposes, an individual is considered married for the whole year in all of the following situations EXCEPT
A. If on the last day of the tax year the individual has not remarried after being widowed during the tax year.
B. If on the last day of the tax year the individual is separated under an interlocutory (not final) decree of divorce.
C. Lived with another individual over half the year as husband and wife in a state that does not recognize a common-law marriage.
D. The individuals are married with no dependents and lived apart the whole year but are not legally separated under a decree of divorce or separate maintenance.
Lived with another individual over half the year as husband and wife in a state that does not recognize a common-law marriage.
Answer (C) is correct.
For federal income tax purposes, an individual is considered to have been married for the entire year if on the last day of the tax year the taxpayer is living together in a common-law marriage that is recognized in the state where the taxpayer is currently living or the state where the common-law marriage began. A taxpayer who lived with another individual over half the year as husband and wife in a state not recognizing common-law marriage is not considered to be married for federal income tax purposes.
A husband and wife can file a joint return even if
A. The spouses have different tax years, provided that both spouses are alive at the end of the year.
B. The spouses have different accounting methods.
C. Either spouse was a nonresident alien at any time during the tax year, provided that at least one spouse
makes the proper election.
D. They were divorced before the end of the tax year.
The spouses have different accounting methods.
Answer (B) is correct.
There is no provision disallowing spouses to file a joint return because they have different accounting methods (Publication 17).
Mr. W died early in the current year. Mrs. W remarried in December of the same year and therefore was unable to file a joint return with Mr. W. What is the filing status of the decedent, Mr. W?
A. Single.
B. Married filing separate return.
C. Married filing joint return.
D. Head of household.
Married filing separate return.
Answer (B) is correct.
Generally, a surviving spouse may file a joint return for himself or herself and the decedent. In that case, the decedent’s filing status on the final return would be married filing jointly. However, a joint return with the deceased spouse may not be filed if the surviving spouse remarried before the end of the year of the decedent’s death. In this case, the filing status of the deceased spouse is that of married filing separate return [Publication 17 and Sec. 6013(a)(2)].
Mrs. W’s husband died in Year 1. She has not remarried and has maintained a home for herself and her dependent son, whom she can claim. In the summer of Year 3, the son was killed in an automobile accident. What is Mrs. W’s best filing status for Year 3?
A. Single.
B. Married filing separate return.
C. Qualifying widow.
D. Head of household.
Qualifying widow.
Answer (C) is correct.
A qualifying widow(er) is a taxpayer whose spouse died in either of the 2 preceding taxable years and who maintains a household that constitutes the principal place of abode of a dependent who is a child or stepchild of the taxpayer and with respect to whom the taxpayer is entitled to a dependency deduction [Sec. 2(a)]. Reg. 1.2-2(c)(1) provides that a dependent’s death during the year will not prevent the taxpayer from qualifying as a surviving spouse (Publication 17). Mrs. W is a qualifying widow and can file as such.
Ms. Doe, by herself, maintains her home in which she and her unmarried daughter resided for the entire year. Her daughter is a qualifying child, but does not qualify as her dependent because she assigned the exemption to her ex-husband. Ms. Doe divorced her husband last year. What is Ms. Doe’s best filing status for the current year?
A. Qualifying widow.
B. Married filing jointly.
C. Single.
D. Head of household.
Head of household.
Answer (D) is correct.
The daughter does not have to qualify as Ms. Doe’s dependent for Ms. Doe to qualify as head of household.
Which of the following is NOT a requirement you must meet to claim head of household filing status?
A. Your spouse did not live in your home during the last 6 months of the tax year.
B. You paid more than half of the cost of keeping up your home for the entire year.
C. Your home was the main home of your foster child for the entire year.
D. You are unmarried or considered unmarried on the last day of the year.
Your home was the main home of your foster child for the entire year.
Answer (C) is correct.
In determining if a taxpayer qualifies for head of household filing status, the taxpayer is considered unmarried if all the following requirements are met:
1. The taxpayer filed a separate return.
2. The taxpayer paid more than half the cost of keeping up the home for the tax year.
3. The taxpayer’s spouse did not live in the home during the last 6 months of the tax year.
4. The home was, for more than half the year, the main home of the taxpayer’s child, stepchild, or eligible foster child.
5. The taxpayer must be able to claim the child as a dependent.
The requirement is that the home be the main home of the child, stepchild, or eligible foster child for more than half the year [Publication 17 and Sec. 2(b)].
Which dependent relative does NOT have to live in the same household as the taxpayer claiming head of household filing status?
A. Daughter.
B. Mother.
C. Uncle.
D. Sister or brother.
Mother.
Answer (B) is correct.
Section 2(b) provides head of household status for an unmarried taxpayer who maintains a household that constitutes the principal place of abode of the taxpayer’s father or mother, but only if the taxpayer is entitled to claim the parent as a dependent. The taxpayer is considered as maintaining a household only if (s)he furnishes over half of the cost of maintaining it. In the case of anyone other than the taxpayer’s father or mother, such person(s) must actually occupy the taxpayer’s own household for the taxpayer to be considered a head of household (Publication 17).
James and Edna Evans are a childless married couple with no other dependents who lived apart for all of the year. On December 31, they were legally separated under a decree of separate maintenance. Which of the following is the only filing-status choice available to them for the year?
A. Married filing joint return.
B. Married filing separate return.
C. Head of household.
D. Single.
Single.
Answer (D) is correct.
The determination of whether an individual is married is made as of the close of the taxable year, so James and Edna are both single for the current year (Publication 17).
Which of the following is a requirement that must be met in determining whether a taxpayer is considered unmarried for head of household filing-status purposes?
A. The individual must be divorced or legally separated for over one year.
B. An individual must pay less than one-half the cost of keeping up a home for the tax year.
C. An individual’s home must be, for at least 6 months, the main home of his child, stepchild, or qualified foster child whom he or the noncustodial parent can properly claim as a dependent.
D. An individual’s spouse must not have lived in their home for the entire tax year.
An individual’s home must be, for at least 6 months, the main home of his child, stepchild, or qualified foster child whom he or the noncustodial parent can properly claim as a dependent.
Answer (C) is correct.
In determining if a taxpayer qualifies for head of household filing status, the taxpayer is considered unmarried if all the following requirements are met:
1. The taxpayer filed a separate return.
2. The taxpayer paid more than half the cost of keeping up the home for the tax year.
3. The taxpayer’s spouse did not live in the home during the last 6 months of the tax year.
4. The home was, for more than half the year, the main home of the taxpayer’s child, stepchild, or qualified foster child.
5. The taxpayer must be able to claim the child as a dependent.
Therefore, the answer is correct because the requirement is that the home be the main home of the child, stepchild, or adopted child for more than half the year [Sec. 2(b)]. (Publication 17.)
Mr. A, a calendar-year taxpayer, died January 15 of Year 2. His widow, Mrs. A, remarried December 15 of Year 2. The last year for which a joint return may be filed by or for Mr. and Mrs. A is
A. Year 1.
B. Year 2.
C. Year 3.
D. Year 4.
Year 1.
Answer (A) is correct.
The determination of whether an individual is married is made as of the close of the taxable year, except that, if his or her spouse dies during the taxable year, such determination is made as of the time of the death [Sec. 7703(a)]. Since the decedent was married at the time of his death, he is considered married for purposes of filing status. A decedent (through a personal representative) and a surviving spouse may file a joint return under Sec. 6013(a)(2) unless the surviving spouse remarries before year end. Since Mrs. A remarried prior to the end of Year 2, they may not file a joint return for Year 2. The last year they could file a joint return was Year 1 (Publication 17).
Mr. Todd, who is 43 years old, has lived apart from his wife since May 2019. For 2019, his two children, whom he can claim as dependents, lived with him the entire year, and he paid the entire cost of maintaining the household. Assuming that Mr. Todd cannot qualify to file a joint return for 2019, he must, nevertheless, file a return if his gross income is at least
A. $5
B. $24,400
C. $12,200
D. $18,350
$18,350
Answer (D) is correct.
Generally, a taxpayer must file a tax return if the taxpayer’s gross income equals or exceeds his or her standard deduction [Sec. 6012(a)]. Standard deductions in 2019 are $24,400 for married filing jointly, $18,350 for heads of household, and $12,200 for single individuals (Publication 501). A taxpayer who has two children and files as head of household must file a return if his or her gross income equals or exceeds $18,350.
Ms. Maple, a single woman age 65, retired in 2019. Prior to her retirement, she received a $6,000 bonus plus $4,850 in wages. After her retirement, she received $9,000 in Social Security benefits. Which of the following is true?
A. Ms. Maple does not have to file a 2019 income tax return.
B. Ms. Maple has to file a 2019 income tax return.
C. Ms. Maple has to file a 2019 income tax return but may exclude the $6,000.
D. Ms. Maple has to file a 2019 income tax return but may exclude the $9,000 in Social Security benefits from income.
Ms. Maple does not have to file a 2019 income tax return.
Answer (A) is correct.
In general, a taxpayer does not have to file a return if his or her gross income is less than his or her standard deduction [Publication 501 and Sec. 6012(a)]. For single individuals who are 65 or over, the standard deduction increases by $1,650. Therefore, the filing threshold will be $13,850 ( $12,200 basic standard deduction + $1,650 additional standard deduction). Ms. Maple’s income does not qualify her Social Security benefits for gross income inclusion in determining her filing requirement.
John Stith, whose father died June 15, 2019, is the executor of his father’s estate. John is required to file a final income tax return for his father. When is this return due if he does not file for an extension (ignoring Saturdays, Sundays, and holidays)?
A. October 15, 2019.
B. March 15, 2020.
C. April 15, 2020.
D. June 15, 2020.
April 15, 2020.
Answer (C) is correct.
The final return of a decedent is due by the date on which the return would have been due had death not occurred. Thus, the final return is generally due by April 15 (Publication 17).
In which of the following situations is no return required to be filed for 2019?
A. Single, filing status single, under age 65, gross income $18,200.
B. Married, filing joint status, both spouses under age 65, gross income $29,400.
C. Single, filing status single, age 70, gross income $13,450.
D. Married, separate filing status, age 65, gross income $10,000.
Single, filing status single, age 70, gross income $13,450.
Answer (C) is correct.
Generally, a taxpayer must file a tax return if the taxpayer’s gross income equals or exceeds his or her standard deduction [Sec. 6012(a)]. Standard deductions in 2019 are $24,400 for married filing jointly, $12,200 for married filing separately, $18,350 for heads of household, and $12,200 for single individuals. For single individuals or heads of household who are over 65, the standard deduction increases by $1,650. Married taxpayers filing separately must file a return when their gross income equals or exceeds the amount of $5. They are not allowed to use the standard deduction amount (Publication 501). The threshold for a single individual over age 65 is $13,850 [$12,200 standard deduction + $1,650 (65+ additional standard deduction)].
Which of the following is true regarding the filing of Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return?
A. Filing Form 4868 provides an automatic 2-month extension of time to file and pay income tax.
B. Any U.S. citizen who is out of the country on April 15, 2020, is allowed an automatic 6-month extension of time to file his or her 2019 return and pay any federal income tax due.
C. Interest is charged on tax not paid by the due date of the return even if an extension is obtained.
D. Electronic filing cannot be used to get an extension of time to file.
Interest is charged on tax not paid by the due date of the return even if an extension is obtained.
Answer (C) is correct.
An automatic extension of 6 months is provided for an individual who files Form 4868 or uses a credit card to make the required tax payment on or before the initial due date. Tax liability must be paid on the original due date of the tax return. Automatic extension for filing the return does not extend time for payment. Interest will be charged from the original due date. If the required payment is made by the regular due date for the return, the return can be filed anytime before the 6-month extension period ends.
Which of the following statements is true regarding the filing of a Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return, for your 2019 tax return?
A. Interest is not assessed on any income tax due if a Form 4868 is filed.
B. Form 4868 provides the taxpayer with an automatic additional 8-month extension to file.
C. Even though you file Form 4868, you will owe interest and may be charged a late payment penalty on the amount you owe if you do not pay the tax due by the regular due date.
D. A U.S. citizen who is out of the country on April 15 will be allowed an additional 12 months to file as long as “Out of the Country” is written across the top of Form 4868.
Even though you file Form 4868, you will owe interest and may be charged a late payment penalty on the amount you owe if you do not pay the tax due by the regular due date.
Answer (C) is correct.
An automatic extension of 6 months is provided for an individual who files Form 4868 or uses a credit card to make a required tax payment on or before the initial due date. The tax liability, however, must be paid when the return must be filed. Automatic extension for filing the return does not extend time for payment. Interest will be charged from the original due date, and penalties may accrue (Publication 17).
Ms. Alexander properly executed a request for an automatic extension of time to file her 2019 tax return. She must file her 2019 return on or before (ignoring Saturdays, Sundays, and holidays)
A. April 15, 2020.
B. July 15, 2020.
C. August 15, 2020.
D. October 15, 2020.
October 15, 2020.
Answer (D) is correct.
An individual may obtain an automatic extension of 6 months for filing Form 1040 if the individual files, on or before the due date of the return, an application (Form 4868) accompanied by a proper estimate of tax due for the year (Publication 17).
Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return, will provide the taxpayer with the following:
A. An automatic extension of 2 months for taxpayers out of the country on April 15.
B. An automatic extension of 6 months to pay the taxes due.
C. An automatic extension of 6 months to file the return.
D. An automatic extension of 8 months to file the return.
An automatic extension of 6 months to file the return.
Answer (C) is correct.
An automatic extension of 6 months is provided for an individual who files Form 4868 or uses a credit card to make the required tax payment on or before the initial due date (Publication 17).
Ensign Beleau, a calendar-year taxpayer, was assigned a post of duty on the U.S.S. Eisenhower. The ship went on a 6-month cruise of the Mediterranean Sea, leaving February 15, 2020. Ensign Beleau did not file Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return. Beleau is automatically granted an extension of time to file his 2019 income tax return and pay any tax due until (ignoring Saturdays, Sundays, and holidays)
A. June 15, 2020.
B. August 15, 2020.
C. October 15, 2020.
D. No automatic extension is granted. Beleau must file and pay tax due by April 15, 2020.
June 15, 2020.
Answer (A) is correct.
A U.S. citizen or resident who, on April 15, is in military or naval service on duty outside the U.S. and Puerto Rico is given an automatic 2-month extension without the necessity of filing Form 4868 (Publication 17).
