R1 - Filing Req and Filing Status

Question 1

Individual Income Tax Formula

Answer 1

Gross Income 
(+) Adjustments
(=) AGI
(-) Standard Deduction / Itemized Deductions
(=) Taxable Income Before QBI
(-) QBI Deduction
(=) Taxable Income

Federal Income Tax + AMT (if any)
(-) Tax Credits
(+) Other Taxes (SE Tax)
(-) Payments
(=) Tax Due / (Refund)

Question 2

1040-EZ = Standard Deduction

Answer 2

Do not itemize on 1040EZ

Question 3

Who must file?

Answer 3

If your income is equal or greater than the sum of:

1. Regular std deduction PLUS
2. additional std deduction amount of blind or >65yo

Question 4

Qualified Widow(er) with Dependent Child
Widow = Whole Year

Answer 4

• May use MFJ std deduction two years after spouse’s death, unless remarries.
• The survivor must pay >1/2 of the cost of maintaining a household where a dependent child lives for the whole year.

Question 5

Head of Household = Must Have Dependent
HOH = Half Year
Ex. Divorced Mom

Answer 5

• Must be unmarried, separated, lived apart for last 6mo of taxable year.
• Can’t be 1040NR
• > 1/2 yr maintains a home that is principal residence for dependent.

Question 6

HOH = Qualifying Dependents

Answer 6

• Qualifying child
• Parent (Not required to live with TP) Ex. Nursing home
• Dependent Relatives: Must live with TP. Could be grandpas, siblings, aunts, uncles, nephews, nieces, in laws. No cousins, foster parents, unrelated dependents allowed, no boyfriends.

Question 7

Qualifying Child = CARES

Answer 7

C = Close Relative
A = Age Limit
R = Residency and filing requirements
E = Eliminate Gross Income Test
S = Support Test

Question 8

Qualifying Child = Close Relative

Answer 8

• Son/Daughter
• Stepson/Stepdaughter
• Siblings/Stepsiblings
• Descendants of any of the above

Question 9

Qualifying Child = Age Limit

Answer 9

• 19
• 24 if in college
• IF permanently disabled, no age limit

Question 10

Qualifying Child = Residency and Filing Req

Answer 10

• Child must have same principal residence place as the TP for >1/2 of year.

Question 11

Qualifying Child = Eliminate Gross Income Test

Answer 11

• If child makes money and it’s not used for their support, then child can still be claimed as Dp.

Question 12

Qualifying Child = Support Test

Answer 12

• Must not have contributed >1/2 of his/her own support.

Question 13

Qualifying Relative = SUPORT

Answer 13

S = Support Test
U = Under specific amount of taxable gross income test
P = Precludes
O = Only citizens and NAFTA test
R = Relative test OR
T = TP lives with individual WHOLE year

Question 14

Qualifying Relative = Support Test

Answer 14

• TP must have supplied >1/2 of support for qualifying relative or be in a multiple support agreement.

Question 15

Qualifying Relative = Under Gross Income Limitation

Answer 15

• Relative’s Taxable Income must be less than $4,300.

- Nontaxable income is ok.

Question 16

Qualifying Relative = Precludes Filing a Joint Return

Answer 16

• Can’t claim if relative is MFJ, and the couple has a tax liability whether they file MFJ or MFS.

Question 17

Qualifying Relative = Only US Persons and NAFTA

Answer 17

• NO 1040NR.

Question 18

Qualifying Relative = Relative test

Answer 18

• Close relatives
• Children could be legally adopted, foster children, and stepchildren.
• Foster parents and cousins allowed. Must live with the taxpayer all year.

Question 19

Qualifying Relative = TP lives with individual (if non-relative) WHOLE year

Answer 19

• Non-relative living in household for WHOLE year may be claimed.

Question 20

Multiple Support Agreements

Answer 20

• One supporter gets full qualification
• A contributor must have contributed >10% of support of qualifying relative or unrelated person who lived a WHOLE year with TP.
• Must decide who claims relative