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HRB FINAL EXAM 2024/2025 WITH 100% ACCURATE SOLUTIONS
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HRB FINAL EXAM 2024/2025 WITH 100% ACCURATE SOLUTIONS
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HRB FINAL EXAM 2024/2025 WITH 100%ACCURATE SOLUTIONS
What is the Difference between earned income and unearned income? -
Precise Answer ✔✔Earned income is received for services performed.
Examples are wages commissions, tips and generally farming and other
business income . Taxable income other than that received for services
performed. Unearned Income includes money received ro the investment
of money or other property, such as interest, dividends, and royalties. It
also includes pensions alimony, unemployment compensation and other
income that is not earned
If an employee thinks their Form W2 is incorrect, what should they do? -
Precise Answer ✔✔Employee should discuss with employer who issued
the document and request a W2C. If no help from employer, notify IRS.
Tax prepaper can then file a substitute.
What information do you need to know to determine whether a taxpayer
is required to file a return? - Precise Answer ✔✔Gross income, filing
status, age and if they are a dependent
For tax purposes, when is a person's marital status determined? - Precise
Answer ✔✔On the last day of the tax year
Where on the tax form can you find the regular standard deduction
amounts? - Precise Answer ✔✔Line 22 on 1040A, In the left margin at
,the top of the page 2 of forms 1040 and 1040A. Look at actual form to
look for line
How much is added to the standard deduction if the taxpayer (or spouse
is age 65 or older, or blind? - Precise Answer ✔✔$1550 if unmarried,
$1250 if married
What is the personal exemption amount for 2016? - Precise Answer
✔✔$4,050
What two amounts are combined to make up the gross income filing
requirments for most taxpayers? - Precise Answer ✔✔The standard
deduction and the personal exemption amounts
Under what circumstances might a taxpayer be required to file a return
even though they do not meet the gross income filing requirements? -
Precise Answer ✔✔1. Has net employment of $400 or more net self
employment 2. You had unemployment income you owe medicare
Advantage MSA, receive HAS, Archer, MSA 3. Reeived an Advanced
Premium Tax credit even if they didn't otherwise have a filing
requirment for the year *Tips, HSA, SE $400, PTC
What is the difference between injured spouse allocation and innocent
spouse relief? - Precise Answer ✔✔The difference between injured
spouse and innocent spouse is significant in the eyes of the IRS. Both
release you from an income tax liability arising from a "married filing
jointly" return but different outcomes. Innocent spouse filed a joint
return byt was unaware that their spouse deliberately under reported tax
,liability. Injured spouse seeks to protect his or her share of the refund in
case it gets seized or offset due to the other spouse's debts or unpaid
obligations
CHAPTER 3: DEPENDENT EXEMPTIONS AND SUPPORT - Precise
Answer ✔✔
What four requirements must be met for an individual to be claimed as a
dependent - Precise Answer ✔✔Must pass the dependent test, joint
return test, citizenship, qualifying child or relative
What are the five tests for a qualifying child? - Precise Answer ✔✔1.
Relationship 2. Age 3. Residency 4. Support 5. Joint Return
How can a married individual meet the joint return test to remain a
qualifying child? - Precise Answer ✔✔They can meet this test by not
filing a joint return with their spouse or they can file a joint return with
their spouse if they are filing only to claim a refund on any taxes
withheld
How can you determine who paid more than half of a person's support? -
Precise Answer ✔✔Total support is determined and reduced by the
funds received by and for the person from all sources other than the
taxpaer. The remaining support is considered to be provided by the
taxpayer. Other sources might include government support Worksheet
for Determining Support
, What happens if an individual is a qualifying child of more than one
taxpayer? - Precise Answer ✔✔Generally, the custodial parent is the one
in which the child spent the most nights
What happens when more than one taxpayer claims the same qualifying
child? - Precise Answer ✔✔Tie Breaker Rules apply : 1. The parent, if
only one of the persons is the childs parent 2. The parent with whom the
child lived the longest during the tax 3. The parents with the highest
AGI if no parent can claim the child as a qualifying child
What four tests must be met for an individual to be considered a
qualifying relative? - Precise Answer ✔✔1. Not be a qualifying child,
the person cannot be the taxpayers qualifying child or the qualifying
child of another taxpayer 2. Relationship: Child, brother, sister, step
sister, step brother, step father , step mother, in-laws 3. Gross Income:
gross income must be less than $4050 4. Support: Taxpayer must
provide more than half the support
How can the gross income for a qualifying relative test be satisfied? -
Precise Answer ✔✔Gross income must be less than $4050 (Do not
include tax exempt income)
What is the purpose of Form 2120 Multiple Support Declaration? -
Precise Answer ✔✔You only need 2120 multiple support declaration if
you are claiming someone other than a qualifying child as a dependent
and there are two or more people including yourself who provide
support for the dependent
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