TAX PREPARER QUESTIONS WITH CORRECT
ANSWERS 2026
Standard Deduction Increases - CORRECT ANSWER -$12,600 Married Filing Jointly or Qualified
Widow(er) increased $200
$9,250 Head of Household increased $150
$6300 Single or Married filing Separately increased $100
Standard Deduction for 65 or older or blind - CORRECT ANSWER -$1500 single or Head of
Household no increase
$1250 for married taxpayers increased $50
Personal Exemption Amount-the amount a person can deduct for each exempt - CORRECT
ANSWER -$4000 for 2016
Form 13614-C - CORRECT ANSWER -Intake/Interview & Quality Review Sheet
Due Diligence - CORRECT ANSWER -doing your part to ensure tax returns are correct
confirm taxpayer id, provide top quality service, make sure facts presented paint a reasonable
picture
Retirement Income - CORRECT ANSWER -Qualified Charitable Distribution (QCD) is nontaxable if
trustee of IRA donating is 70 1/2. Maximum for annual exclusion for QCD is $100,000. Anything
in excess is income. If joint return, spouse can also have up to $100,000 QCD
Educator expenses - CORRECT ANSWER -$250 per year qualified expenses. Spouse can also
deduct $250 if educator. Both have to have separate expenses of their own. Any expenses
exceeding $250 can be treated as an itemized employment related deduction on Schedule A.
Items that do not qualify are home schooling, nonathletic supplies for physical education or
, health courses. have to put in 900 hours of teaching during the school year (no part time
teachers). If they receive reimbursement, they can not apply deductions (or use EE bonds to pay
educational expenses or nontaxable earning from an educational account)
MAGI - CORRECT ANSWER -Modified Adjusted Gross Income
Tuition and Fees Deduction - CORRECT ANSWER -Up to $4000 can't be claimed if filing married
filing separately status. If claiming, have to have paid the expenses and claim the dependent
receiving. Student can only deduct from their taxes if they are not dependent on another tax
form. If they are dependent and paid own expenses, neither parent or dependent can claim
adjustment. But if student is not a dependent and another person paid fees (grandparent?)
then student can treat amounts as gift amount. Those taxpayers not eligible for this deduction
might be eligible for education tax credit.
Carly Example - CORRECT ANSWER -She is 18 claimed by her parents as dependent. She took
out loans for tuition and fees. Parents can't deduct loans and she can't deduct loans because
she is claimed as dependent by them. they can look into educational credits though
Qualified education expenses
Work up tuition and fees adjustment and educational credit before deciding which one helps
the client most. - CORRECT ANSWER -don't include insurance, medical expenses, transportation,
room and board. Books not included unless specially required for course and couldn't buy them
anywhere else. Ask if taxpayer offset any expenses with distributions from state tuition
programs. (529)
Form 5696 - CORRECT ANSWER -Nonbusiness energy property credit for biomass stoves,
heating, air conditioning, insulation, roofs, water heaters, windows and doors, no solar. Credit is
only for taxpayer's main home, new construction does not qualify nor does rental property.
Cancellation of debt-1 - CORRECT ANSWER -auto loans, credit card, medical care, professional
services, installment purchases of furniture or other personal property, mortgages and home
equity loans
ANSWERS 2026
Standard Deduction Increases - CORRECT ANSWER -$12,600 Married Filing Jointly or Qualified
Widow(er) increased $200
$9,250 Head of Household increased $150
$6300 Single or Married filing Separately increased $100
Standard Deduction for 65 or older or blind - CORRECT ANSWER -$1500 single or Head of
Household no increase
$1250 for married taxpayers increased $50
Personal Exemption Amount-the amount a person can deduct for each exempt - CORRECT
ANSWER -$4000 for 2016
Form 13614-C - CORRECT ANSWER -Intake/Interview & Quality Review Sheet
Due Diligence - CORRECT ANSWER -doing your part to ensure tax returns are correct
confirm taxpayer id, provide top quality service, make sure facts presented paint a reasonable
picture
Retirement Income - CORRECT ANSWER -Qualified Charitable Distribution (QCD) is nontaxable if
trustee of IRA donating is 70 1/2. Maximum for annual exclusion for QCD is $100,000. Anything
in excess is income. If joint return, spouse can also have up to $100,000 QCD
Educator expenses - CORRECT ANSWER -$250 per year qualified expenses. Spouse can also
deduct $250 if educator. Both have to have separate expenses of their own. Any expenses
exceeding $250 can be treated as an itemized employment related deduction on Schedule A.
Items that do not qualify are home schooling, nonathletic supplies for physical education or
, health courses. have to put in 900 hours of teaching during the school year (no part time
teachers). If they receive reimbursement, they can not apply deductions (or use EE bonds to pay
educational expenses or nontaxable earning from an educational account)
MAGI - CORRECT ANSWER -Modified Adjusted Gross Income
Tuition and Fees Deduction - CORRECT ANSWER -Up to $4000 can't be claimed if filing married
filing separately status. If claiming, have to have paid the expenses and claim the dependent
receiving. Student can only deduct from their taxes if they are not dependent on another tax
form. If they are dependent and paid own expenses, neither parent or dependent can claim
adjustment. But if student is not a dependent and another person paid fees (grandparent?)
then student can treat amounts as gift amount. Those taxpayers not eligible for this deduction
might be eligible for education tax credit.
Carly Example - CORRECT ANSWER -She is 18 claimed by her parents as dependent. She took
out loans for tuition and fees. Parents can't deduct loans and she can't deduct loans because
she is claimed as dependent by them. they can look into educational credits though
Qualified education expenses
Work up tuition and fees adjustment and educational credit before deciding which one helps
the client most. - CORRECT ANSWER -don't include insurance, medical expenses, transportation,
room and board. Books not included unless specially required for course and couldn't buy them
anywhere else. Ask if taxpayer offset any expenses with distributions from state tuition
programs. (529)
Form 5696 - CORRECT ANSWER -Nonbusiness energy property credit for biomass stoves,
heating, air conditioning, insulation, roofs, water heaters, windows and doors, no solar. Credit is
only for taxpayer's main home, new construction does not qualify nor does rental property.
Cancellation of debt-1 - CORRECT ANSWER -auto loans, credit card, medical care, professional
services, installment purchases of furniture or other personal property, mortgages and home
equity loans
