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Enrolled Agent Exam Part 1 Exam Questions and Answers 2024-202
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Enrolled Agent Exam Part 1 ExamQuestions and Answers
Individual itax iidentification inumber i(ITIN) ivs iTax iidentification inumber i(TIN) i- iCorrect
iAnswers i-Individual itax iidentification inumber i(ITIN):
- iAn iITIN idoes inot iauthorize iwork iin ithe iU.S. ior iprovide ieligibility ifor iSocial iSecurity
ibenefits ior ithe iEarned iIncome iTax iCredit. i
- iAny iITIN ithat iis inot iused ion ia ifederal itax ireturn ifor ithree iconsecutive itax iyears iwill
iexpire. i
- iA itaxpayer ican't ielectronically ifile i(e-file) ia ireturn iusing ian iITIN iin ithe icalendar iyear
ithe iITIN iis iassigned.
Tax iidentification inumber i(TIN): i
- iEverybody ion ithe itax ireturn, iincluding idependents, ineeds ia ivalid itaxpayer
iidentification inumber i(TIN) iissued iby ithe idue idate iof ithe ireturn i(including iextensions).
iThere iis ian iexception ifor ia ichild ithat iis iborn iand idies iin ithe isame iyear i
- iA iTIN iis ia iSocial iSecurity inumber i(SSN), ian iindividual itaxpayer iidentification
inumber i(ITIN), ior ian iadoption itaxpayer iidentification inumber i(ATIN) i
- iEarned iIncome iCredit, iChild iTax iCredit, iand iAdditional iChild iTax iCredit irequires ia
ivalid iSSN ionly i
Under ithe iAmerican iRescue iPlan iAct iof i2021, ifor i2021 iand ifuture iyears, iif ia
iqualifying ichild idoes inot ihave ia ivalid iSSN, itaxpayer imay iclaim ithe iearned iincome
icredit ifor iindividuals iwith ino iqualifying ichildren. i
- iCredit ifor iOther iDependents iand iAmerican iOpportunity iCredit irequires ia ivalid iSSN,
iITIN, ior iATIN
Due idiligence ipenalty i- iCorrect iAnswers i-For iany ifailure irelating ito ia ireturn ior iclaim
ifor irefund ifiled iin i2023 i(generally i2022 itax ireturns ifiled iin i2023), ipenalty iis i$560 ifor
ieach ifailure iwith ino imaximum ipenalty iunless ifailure iis idue ito ireasonable icause iand
inot iwillful ineglect. i
Failure ito ibe idiligent iin idetermining ieligibility ifor icertain itax ibenefits i- iEarned iIncome
iCredit, iAmerican iOpportunity iCredit, iChild iTax iCredit i(including iAdditional iChild iTax
iCredit iand iCredit ifor iOther iDependents), iand iHead iof iHousehold ifiling istatus.
iPreparer imust iask iall iquestions irequired ion iForm i8867 iand ialso iask iadditional
iquestions iwhen iinformation iseems iincorrect, iinconsistent, ior iincomplete. iPreparer
,imust ialso iverify iidentity, iprepare ia icomputational ichecklist i(Form i8867 ior iequivalent),
iand imeet ia irecordkeeping irequirement.
Custodial iparent i- iCorrect iAnswers i-The icustodial iparent iis ithe iparent iwith iwhom ithe
ichild ilived ifor ithe igreater inumber iof inights iduring ithe iyear. iOnly ithe icustodial iparent
iis ientitled ito iclaim ithe ichild ifor ihead iof ihousehold ifiling istatus, ithe icredit ifor ichild iand
idependent icare iexpenses, ithe iexclusion ifor idependent icare ibenefits, ithe iearned
iincome icredit, iand ithe ihealth icoverage itax icredit. i
The icustodial iparent ican ifile iform i8332 iallowing ithe inoncustodial iparent ito iclaim ithe
ichild ifor ithe ichild itax icredit, iadditional ichild itax icredit, iand ithe icredit ifor iother
idependents
Situations iwhere itaxpayer iis irequired ito ifile ia ireturn i- iCorrect iAnswers i-- iNet iearnings
ifrom iself-employment iare i$400 ior imore
- iChurch iwages iare i$108.28 ior imore i(from ia ichurch ithat iis iFICA iexempt) i
- iThe itaxpayer i(or ispouse, iif ifiling ijointly) ireceived iHSA, iArcher iMSA, ior iMedicare
iAdvantage iMSA idistributions i
- iAdvance ipayments iof ithe ipremium itax icredit iwere imade ifor ithe itaxpayer, ispouse, ior
ia idependent iwho ienrolled iin icoverage ithrough ithe iHealth iInsurance iMarketplace i
- iThe itaxpayer iowes ispecial itaxes i(e.g. ihousehold iemployment itaxes) ior imust
irecapture icertain icredits ior itaxes
A isingle idependent i(who imay ibe iclaimed iby ianother itaxpayer) imust ifile ia ireturn iif iany
iof ithe ifollowing iapply iin i2022 i- iCorrect iAnswers i-- iUnearned iincome imore ithan
i$1,150 i($2,900 iif iblind ior i65 ior iolder, i$4,650 iif iblind iand i65 ior iolder) i
- iEarned iincome imore ithan i$12,950 i($14,700 iif iblind ior i65 ior iolder, i$16,450 iif iblind
iand i65 ior iolder) i
- iGross iincome imore ithan ithe ilarger iof: i
i-$1,150 i($2,900 iif iblind ior i65 ior iolder, i$4,650 iif iblind iand i65 ior iolder), ior i
i-Earned iincome i(up ito i$12,550) iplus i$400 i(plus i$2,150 iif iblind ior i65 ior iolder, iplus
i$3,900 iif iblind iand i65 ior iolder)
A itaxpayer iwith igross iincome ibelow ithe igross iincome ithreshold i(based ion ifiling istatus
iand iage) iis inot irequired ito ifile ia ireturn. iGross iincome ithreshold i2022: i- iCorrect
iAnswers i-- iSingle i$12,950 i($14,700 iif i65 ior iolder) i
- iHead iof iHousehold i$19,400 i($21,150 iif i65 ior iolder) i
,- iMarried iFiling iJointly i$25,900 i($27,300 iif ione ispouse i65 ior iolder, i$28,700 iif iboth
ispouses i65 ior iolder) i
- iQualifying iSurviving iSpouse i$25,900 i($27,300 iif i65 ior iolder) i
- iMarried iFiling iSeparately i$5 i(any iage)
Gross iincome i- iCorrect iAnswers i-The itotal iof iearned iand iunearned iincome isubject ito
itax. i
Gross iincome imeans iall iincome iyou ireceived iin ithe iform iof imoney, igoods, iproperty,
iand iservices ithat iisn't iexempt ifrom itax, iincluding iany iincome ifrom isources ioutside
ithe iUnited iStates ior ifrom ithe isale iof iyour imain ihome i(even iif iyou ican iexclude ipart ior
iall iof iit).
Earned iincome iIncludes i- iCorrect iAnswers i-Earned iincome iincludes i
- iwages, isalaries, itips, i
- iunion istrike ibenefits, i
- ilong-term idisability ibenefits ireceived iprior ito iminimum iretirement iage, i
- inet iearnings ifrom iself-employment, iand i
- inon-taxable icombat ipay i(only iif ielected iand iincluded iin itaxable iincome). i
- iIncludes ithe iamount iof itaxable ischolarship ior ifellowship igrant i(only ifor ipurposes iof
ifiling irequirements iand ithe istandard ideduction). i
For iIRA icontributions, itaxable ialimony ifrom idivorces ifinalized ibefore i2019
Unearned iincome i- iCorrect iAnswers i-Payments iclassified ias iincome ithat iare inot
iconsidered iearned, iinclude: i
- iunemployment icompensation, i
- itaxable iSocial iSecurity ibenefits, i
- itaxable ipensions, i
- iannuity iincome, i
- icanceled idebt, i
- iunearned iincome ifrom ia itrust, i
- itaxable iinterest, idividends, icapital igains, i
- ialimony, ior i
- ipay ireceived iwhile iin ijail.
Constructive ireceipt i- iCorrect iAnswers i-Constructive ireceipt ioccurs iwhen ithe iincome
iis iavailable ifor ia itaxpayer's iunrestricted iwithdrawal. iPhysical ipossession iis inot ia
irequirement.
Cash iMethod ivs iAccrual iMethod i- iCorrect iAnswers i-Cash imethod: iMost iindividual
itaxpayers iuse ithe icash imethod. iRecord iincome ion iconstructive ireceipt iand iexpenses
iwhen ipayment iis imade.
, Accrual imethod: iRecord iincome iwhen iearned iand iexpenses iwhen iaccrued. iThe iIRS
iconsiders ithe itaxpayer ito ihave iearned iincome iwhen iall ithe ievents ihave ioccurred ithat
ifix ithe iright ito ireceive isuch iincome iand ithe iamount iis ireasonably ideterminable.
Tip iincome itaxability i- iCorrect iAnswers i-- iAll itips i(cash ior iFMV iof iproperty) iare
isubject ito ifederal iincome itax, iSS, iand iMedicare. i
- iA ipenalty iequal ito i50% iof iunpaid iSS iand iMedicare itaxes idue ion iunreported itips. i
- iReport icash iand icharge itips ito ithe iemployer iby ithe i10th iof ithe ifollowing imonth iif
i$20 ior imore. i
- iTips ireported ito ithe iemployer ion itime iare iconsidered iincome iin imonth ireported. i
- iTips ithat iare inot ireported ion itime iare iconsidered iincome iin imonth iactually ireceived.
i
- iReport inon-cash itips ito iIRS, inot iemployer. iNo iSS ior iMedicare ion inon-cash itips.
Group iterm ilife iinsurance itaxability i- iCorrect iAnswers i-The icost iof iup ito i$50,000 iof
igroup iterm ilife iinsurance icoverage iprovided iby ian iemployer iis inot iincluded iin
iincome. i
The iemployee's iincome ishall iinclude ipremiums ipaid iby ithe iemployer ifor imore ithan
i$50,000 iof icoverage.
Disability iincome itaxability i- iCorrect iAnswers i-The iamount ireceived idue ito iemployer-
paid iplan ipremiums iis itaxable.
Sick ipay itaxability i- iCorrect iAnswers i-Pay ireceived ifrom ian iemployer iwhile isick ior
iinjured iis ipart iof isalary ior iwages. iInclude isick ipay ibenefits ireceived ifrom iother
isources iin iincome iif ithe iemployee idid inot ipay ipremiums ito ireceive ithe ibenefit.
Advance icommissions itaxability i- iCorrect iAnswers i-Include iadvance icommissions ior
iother iamounts ifor ifuture iservices ias iincome iin ithe iyear ireceived
Foreign iincome itaxability i- iCorrect iAnswers i-U.S. icitizens iand iresident ialiens imust
ireport iincome ifrom isources ioutside ithe iUnited iStates i(foreign iincome) ion itheir itax
ireturn iunless iit iis iexempt iby iU.S. ilaw.
Working ifor ia iforeign iemployer iin ithe iUnited iStates i- iCorrect iAnswers i-Employees iof
ian iinternational iorganization ior ia iforeign igovernment iin ithe iUnited iStates iare iexempt
ifrom iSocial iSecurity iand iMedicare iemployee itaxes.
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