R1 - Filing Req and Filing Status Flashcards
Individual Income Tax Formula
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)
1040-EZ = Standard Deduction
Do not itemize on 1040EZ
Who must file?
If your income is equal or greater than the sum of:
- Regular std deduction PLUS
- additional std deduction amount of blind or >65yo
Qualified Widow(er) with Dependent Child Widow = Whole Year
- 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.
Head of Household = Must Have Dependent
HOH = Half Year
Ex. Divorced Mom
- 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.
HOH = Qualifying Dependents
- 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.
Qualifying Child = CARES
C = Close Relative A = Age Limit R = Residency and filing requirements E = Eliminate Gross Income Test S = Support Test
Qualifying Child = Close Relative
- Son/Daughter
- Stepson/Stepdaughter
- Siblings/Stepsiblings
- Descendants of any of the above
Qualifying Child = Age Limit
- 19
- 24 if in college
- IF permanently disabled, no age limit
Qualifying Child = Residency and Filing Req
- Child must have same principal residence place as the TP for >1/2 of year.
Qualifying Child = Eliminate Gross Income Test
- If child makes money and it’s not used for their support, then child can still be claimed as Dp.
Qualifying Child = Support Test
- Must not have contributed >1/2 of his/her own support.
Qualifying Relative = SUPORT
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
Qualifying Relative = Support Test
- TP must have supplied >1/2 of support for qualifying relative or be in a multiple support agreement.
Qualifying Relative = Under Gross Income Limitation
- Relative’s Taxable Income must be less than $4,300.
- Nontaxable income is ok.
Qualifying Relative = Precludes Filing a Joint Return
- Can’t claim if relative is MFJ, and the couple has a tax liability whether they file MFJ or MFS.
Qualifying Relative = Only US Persons and NAFTA
- NO 1040NR.
Qualifying Relative = Relative test
- Close relatives
- Children could be legally adopted, foster children, and stepchildren.
- Foster parents and cousins allowed. Must live with the taxpayer all year.
Qualifying Relative = TP lives with individual (if non-relative) WHOLE year
- Non-relative living in household for WHOLE year may be claimed.
Multiple Support Agreements
- 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
