Enrolled Agent
American Opportunity Credit - ANS-a credit for qualified education expenses paid for an
eligible student for the first four years of higher education. You can get a maximum
annual credit of $2,500 per eligible student.
Eligible Student - ANS-1. Not claimed an AOC in any four earlier tax years
2. Had not completed the first four years of postsecondary education before 2011
3. Student was enrolled at least half-time in a program leading to a degree for at least
one academic period beginning in 2011;
4. Student had not been convicted of any federal or state felony for possessing or
distributing a controlled substance as of the end of 2011.
Which of the following statements is correct regarding Form 1095A, Health Insurance
Marketplace Statement?
(A) Taxpayers do not need Form 1095A to complete Form 8962, Premium Tax Credit, to
reconcile advance
payments of the premium tax credit or claim the premium tax credit on their tax return
(B) Taxpayers will receive Form 1095A to complete Form 8962, Premium Tax Credit, if
they have been covered by an employer insurance plan for the entire year
(C) Taxpayers will use Form 1095A to complete Form 8962, Premium Tax Credit, to
reconcile advance payments of the premium tax credit or claim the premium tax credit
on their tax return
(D) Taxpayers will attach a Form 1095A with their return to reconcile advance payments
of the premium tax
credit or claim the premium tax credit on their tax return - ANS-C
Form 8962 Instructions, p. 2
American Opportunity Credit Amount - ANS-o 100% of qualified tuition & related
expenses paid by taxpayer is not > $2,000
o 25% of expenses paid as exceeds $2,000 but not $4,000
(AOC) Limitations - ANS-o Credit only allowed for year if at least ½ time student for part
of the year
,o Only allowed for first 4 years of postsecondary
Denial of credit if student convicted of felony drug offense
Two taxpayers married on November 30. That same year, the husband enrolled in an
accredited college to
further his career and subsequently received a Form 1098-T, Tuition Statement. The
wife was employed with an income of $45,000 and paid for the husband's education
expenses. Based on their circumstances, what is the correct method to report the
education credit?
(A) Taxpayers must file a joint return to claim an education credit
(B) Based on the wife's AGI, they do not qualify to claim an education credit
(C) Husband is ineligible to claim an education credit because the wife paid his
education expenses
(D) Wife should report nonqualified education expenses on Form 8863, Education
Credits (American Opportunity
and Lifetime Learning Credits) - ANS-A
IRC § 25A(g)(6); Instructions for Form 8863; page 2
The taxpayer has a child under the age of 24 who is a full-time student in their 2nd year
of college. The student will be claimed as a dependent on the taxpayer's return.
The student's educational expenses included $8,000 for tuition and room and board of
$4,000.
The student received a $5,000 scholarship for tuition use only, as well as an additional
$2,500 scholarship to pay any of the student's college expenses.
Which of the following statements is correct, based on the information above?
(A) The student can claim the American Opportunity credit on their return for tuition
expenses of $2,500 and
should report as income $2,000 of the $2,500 scholarship
(B) The taxpayer can claim the American Opportunity credit on their return for tuition
expenses of $2,500, and
the student should report as income $2,000 of the $2,500 scholarship
(C) The taxpayer can claim the American Opportunity credit on their return for tuiti -
ANS-B
, IRC § 25A(i); IRC § 117; Publication 970, pp. 5, 7
Which of the following situations will disqualify a single individual from claiming the
premium tax credit?
(A) Marriage to an individual enrolled in a qualified health plan
(B) Increase in household income to 390% of the federal poverty line
(C) Inheritance of $1,100,000 non-income producing vacation home
(D) Becoming eligible as a dependent on their parent's joint tax return - ANS-D
IRC § 36B(c)(1)(C); Publication Title: 17, Chapter 37, Premium Tax Credit, Pgs.
246-247; Pub 974;
Instructions for Form 8962
To avoid the penalty for not having insurance, taxpayers must be enrolled in qualifying
health coverage, also called minimum essential coverage. All of the following are
examples of minimum essential coverage EXCEPT:
(A) Certain insurance coverage that may provide limited benefits. That includes, but is
not limited to, the
following types of plans: stand-alone dental and vision, accident or disability income or
workers' compensation
(B) Employer-sponsored coverage. That includes, but is not limited to, the following
types of plans: a self-insured group health plan for employees, retiree and COBRA
coverage
(C) Individual health coverage. That includes, but is not limited to, the following types of
plans: health insurance
purchased directly from an insurance company, or Health Insurance Marketplace
(D) Coverage under government-sponsored programs. That includes, but is not limited
to, the following types of plans: - ANS-A
Publication 974, p. 8
All of the following income types are reported on Form 1099-MISC EXCEPT:
American Opportunity Credit - ANS-a credit for qualified education expenses paid for an
eligible student for the first four years of higher education. You can get a maximum
annual credit of $2,500 per eligible student.
Eligible Student - ANS-1. Not claimed an AOC in any four earlier tax years
2. Had not completed the first four years of postsecondary education before 2011
3. Student was enrolled at least half-time in a program leading to a degree for at least
one academic period beginning in 2011;
4. Student had not been convicted of any federal or state felony for possessing or
distributing a controlled substance as of the end of 2011.
Which of the following statements is correct regarding Form 1095A, Health Insurance
Marketplace Statement?
(A) Taxpayers do not need Form 1095A to complete Form 8962, Premium Tax Credit, to
reconcile advance
payments of the premium tax credit or claim the premium tax credit on their tax return
(B) Taxpayers will receive Form 1095A to complete Form 8962, Premium Tax Credit, if
they have been covered by an employer insurance plan for the entire year
(C) Taxpayers will use Form 1095A to complete Form 8962, Premium Tax Credit, to
reconcile advance payments of the premium tax credit or claim the premium tax credit
on their tax return
(D) Taxpayers will attach a Form 1095A with their return to reconcile advance payments
of the premium tax
credit or claim the premium tax credit on their tax return - ANS-C
Form 8962 Instructions, p. 2
American Opportunity Credit Amount - ANS-o 100% of qualified tuition & related
expenses paid by taxpayer is not > $2,000
o 25% of expenses paid as exceeds $2,000 but not $4,000
(AOC) Limitations - ANS-o Credit only allowed for year if at least ½ time student for part
of the year
,o Only allowed for first 4 years of postsecondary
Denial of credit if student convicted of felony drug offense
Two taxpayers married on November 30. That same year, the husband enrolled in an
accredited college to
further his career and subsequently received a Form 1098-T, Tuition Statement. The
wife was employed with an income of $45,000 and paid for the husband's education
expenses. Based on their circumstances, what is the correct method to report the
education credit?
(A) Taxpayers must file a joint return to claim an education credit
(B) Based on the wife's AGI, they do not qualify to claim an education credit
(C) Husband is ineligible to claim an education credit because the wife paid his
education expenses
(D) Wife should report nonqualified education expenses on Form 8863, Education
Credits (American Opportunity
and Lifetime Learning Credits) - ANS-A
IRC § 25A(g)(6); Instructions for Form 8863; page 2
The taxpayer has a child under the age of 24 who is a full-time student in their 2nd year
of college. The student will be claimed as a dependent on the taxpayer's return.
The student's educational expenses included $8,000 for tuition and room and board of
$4,000.
The student received a $5,000 scholarship for tuition use only, as well as an additional
$2,500 scholarship to pay any of the student's college expenses.
Which of the following statements is correct, based on the information above?
(A) The student can claim the American Opportunity credit on their return for tuition
expenses of $2,500 and
should report as income $2,000 of the $2,500 scholarship
(B) The taxpayer can claim the American Opportunity credit on their return for tuition
expenses of $2,500, and
the student should report as income $2,000 of the $2,500 scholarship
(C) The taxpayer can claim the American Opportunity credit on their return for tuiti -
ANS-B
, IRC § 25A(i); IRC § 117; Publication 970, pp. 5, 7
Which of the following situations will disqualify a single individual from claiming the
premium tax credit?
(A) Marriage to an individual enrolled in a qualified health plan
(B) Increase in household income to 390% of the federal poverty line
(C) Inheritance of $1,100,000 non-income producing vacation home
(D) Becoming eligible as a dependent on their parent's joint tax return - ANS-D
IRC § 36B(c)(1)(C); Publication Title: 17, Chapter 37, Premium Tax Credit, Pgs.
246-247; Pub 974;
Instructions for Form 8962
To avoid the penalty for not having insurance, taxpayers must be enrolled in qualifying
health coverage, also called minimum essential coverage. All of the following are
examples of minimum essential coverage EXCEPT:
(A) Certain insurance coverage that may provide limited benefits. That includes, but is
not limited to, the
following types of plans: stand-alone dental and vision, accident or disability income or
workers' compensation
(B) Employer-sponsored coverage. That includes, but is not limited to, the following
types of plans: a self-insured group health plan for employees, retiree and COBRA
coverage
(C) Individual health coverage. That includes, but is not limited to, the following types of
plans: health insurance
purchased directly from an insurance company, or Health Insurance Marketplace
(D) Coverage under government-sponsored programs. That includes, but is not limited
to, the following types of plans: - ANS-A
Publication 974, p. 8
All of the following income types are reported on Form 1099-MISC EXCEPT:
