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HRB Final Exam ( Latest 2024 / 2025 ) Actual Questions and Answers 100% Correct
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HRB Final Exam ( Latest 2024 / 2025 ) Actual Questions and Answers 100% Correct
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HRB Final ExamBy ExamNavigator
, HRB Final Exam
1. What is the Difference between earned income and unearned income?-
Answer: Earned income is received for services performed. Examples are wages com-
missions, tips and generally farming and other business income . Taxable income other than
that received for services performed. Unearned Income includes moneyreceived ro the
investment of money or other property, such as interest, dividends,and royalties. It also
includes pensions alimony, unemployment compensation andother income that is not earned
2. If an employee thinks their Form W2 is incorrect, what should they do?
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.
3. What information do you need to know to determine whether a taxpayeris required to file a
return?
Answer: Gross income, filing status, age and if they are a dependent
4. For tax purposes, when is a person's marital status determined?
Answer: On the lastday of the tax year
5. Where on the tax form can you find the regular standard deduction amounts?
Answer: Line 22 on 1040A, In the left margin at the top of the page 2 of forms1040 and
1040A. Look at actual form to look for line
6. How much is added to the standard deduction if the taxpayer (or spouse isage 65 or older,
or blind?
Answer: $1550 if unmarried, $1250 if married
7. What is the personal exemption amount for 2016?
Answer: $4,050
8. What two amounts are combined to make up the gross income filing requirments for most
taxpayers?
Answer: The standard deduction and the personal exemption amounts
9. Under what circumstances might a taxpayer be required to file a return eventhough they do
not meet the gross income filing requirements?
Answer:
1. Has net employment of $400 or more net self employment
2.You had unemployment incomeyou owe medicare Advantage MSA, receive HAS, Archer,
MSA
3. Reeived an Advanced Premium Tax credit even if they didn't otherwise have a filing
requirmentfor the year *Tips, HSA, SE $400, PTC
, 10. What is the difference between injured spouse allocation and innocent spouse relief?
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 arisingfrom a "married filing jointly"
return but different outcomes. Innocent spouse filed ajoint 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 seizedor offset due to the other spouse's debts or unpaid
obligations
11. CHAPTER 3: DEPENDENT EXEMPTIONS AND SUPPORT
12. What four requirements must be met for an individual to be claimed as adependent
Answer: Must pass the dependent test, joint return test, citizenship, qualifyingchild or relative
13. What are the five tests for a qualifying child?
Answer: 1. Relationship 2. Age 3.Residency 4. Support 5. Joint Return
14. How can a married individual meet the joint return test to remain a qualifying child?
Answer: They can meet this test by not filing a joint return with their spouse orthey can file a
joint return with their spouse if they are filing only to claim a refund on any taxes withheld
15. How can you determine who paid more than half of a person's support?-
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 consideredto be provided by
the taxpayer. Other sources might include government support Worksheet for Determining
Support
16. What happens if an individual is a qualifying child of more than one taxpayer?
Answer: Generally, the custodial parent is the one in which the child spent themost nights
17. What happens when more than one taxpayer claims the same qualifying child?
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
18. What four tests must be met for an individual to be considered a qualifyingrelative?
Answer:
1. Not be a qualifying child, the person cannot be the taxpayers qualifyingchild 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 halfthe support
19. How can the gross income for a qualifying relative test be satisfied?
Answer: Grossincome must be less than $4050 (Do not include tax exempt income)
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