H&R Block Final Review Exam With 100% Correct
Answers 2025
/. What is the difference between earned income and unearned income? - Answer-
Earned income is received for services performed. Some examples of earned income
include wages, commissions, tips, farming, and other business income.
Unearned income is taxable income that does not meet the definition of earned income.
Examples of unearned income include interest income, dividends, rents and royalties,
pensions, alimony, and unemployment income.
/.If an employee thinks their Form W-2 is incorrect, what should they do? - Answer-If the
taxpayer's name, social security number, or earnings or withholdings are incorrect, the
taxpayer should notify their employer and request a corrected Form W-2. The employee
should request that the employer update their records and verify that the earnings were
properly credited with the Social Security Administration. However, the taxpayer is still
responsible for filing a timely tax return. If the employee's attempts to obtain a corrected
Form W-2 from their employer are not successful, the taxpayer should notify the IRS. It
may be necessary to prepare a substitute Form W-2.
/.What information do you need to know to determine whether a taxpayer is required to
file a return? - Answer-The taxpayer's marital status, age at the end of the tax year,
gross income for the year, and if the taxpayer is a dependent.
/.Where on Form 1040 can you find the regular standard deduction amounts? - Answer-
In the left-hand margin on page 1 of Form 1040. They are: single and married filing
separately, $12,200; married filing jointly and qualifying widow(er), $24,400; and head of
household, $18,350.
/.How much is added to the standard deduction if the taxpayer (or spouse) is age 65 or
older, or blind? - Answer-$1,300 for married taxpayers and qualifying widow(er)s, or
$1,650 for all other unmarried taxpayers, is added for each condition.
/.What is the personal exemption amount for 2019? - Answer-There is no personal
exemption for 2019. A personal exemption was an amount previously allowed by law to
reduce income that would otherwise be taxed. The Tax Cuts and Jobs Act of 2017
repealed this deduction beginning in 2018.
/.How is the gross income filing requirement determined for most taxpayers? - Answer-
The taxpayer's standard deduction, including the additional amounts for age and
blindness. However, for MFS, the amount is $5.
/.What is the difference between injured spouse allocation and innocent spouse relief? -
Answer-The IRS provides an injured spouse allocation for the taxpayer to protect their
, portion of a refund from a spouse's past-due federal income tax, unpaid student loans,
or unpaid child and spousal support, or state income tax.
The IRS provides innocent spouse relief to taxpayers who file a joint return and later
learn that their spouse has underestimated income (or overstated a credit or deduction)
on the return.
/.What is a thorough interview? - Answer-A thorough interview consists of asking
general information questions, then asking additional questions whenever information is
incomplete or seems inaccurate or inconsistent
/.What is a conflict of interest? - Answer-Circular 230 states that a conflict of interest
exists if the representation of one client will be directly adverse to another client, or if
there is a significant risk that the representation of one or more clients will be materially
limited by the practitioner's responsibilities to another client, a former client, or a third
person, or by a personal interest of the practitioner.
/.What actions can resolve a conflict of interest? - Answer-A conflict of interest is
resolved when it is acknowledged, disclosed to all parties, and the parties have
consented to waiving the conflict.
/.What taxpayer information is confidential? - Answer-Any information that could
potentially identify the taxpayer is confidential. Information includes (but is not limited to)
name, address and phone number, social security number, place of employment, and
any information from a tax return.
/.What is a tax preparer's responsibility upon finding out that a taxpayer has not
complied with one or more tax laws? - Answer-A tax preparer must only advise the
taxpayer of the noncompliance and the consequences for not correcting the situation.
The taxpayer is the only individual who can decide to make corrections to their return.
/.What action should a tax preparer take if a taxpayer insists on reporting information
that is inaccurate? - Answer-A tax preparer may not sign a return reporting clearly
inaccurate information or otherwise assist a taxpayer in filing an inaccurate return.
/.A tax preparer may not sign a return reporting clearly inaccurate information or
otherwise assist a taxpayer in filing an inaccurate return. - Answer-The dependent must
be a qualifying child or qualifying relative; they must be a U.S. citizen or a resident of
the United States, Canada, or Mexico; they cannot file a joint return (unless solely to
claim a refund of taxes paid); and the taxpayer claiming the dependent must not be a
dependent of another taxpayer.
/.What are the five tests for a qualifying child? - Answer-Relationship test.
Age test.
Residency test.
Support test.
Joint return test.
Answers 2025
/. What is the difference between earned income and unearned income? - Answer-
Earned income is received for services performed. Some examples of earned income
include wages, commissions, tips, farming, and other business income.
Unearned income is taxable income that does not meet the definition of earned income.
Examples of unearned income include interest income, dividends, rents and royalties,
pensions, alimony, and unemployment income.
/.If an employee thinks their Form W-2 is incorrect, what should they do? - Answer-If the
taxpayer's name, social security number, or earnings or withholdings are incorrect, the
taxpayer should notify their employer and request a corrected Form W-2. The employee
should request that the employer update their records and verify that the earnings were
properly credited with the Social Security Administration. However, the taxpayer is still
responsible for filing a timely tax return. If the employee's attempts to obtain a corrected
Form W-2 from their employer are not successful, the taxpayer should notify the IRS. It
may be necessary to prepare a substitute Form W-2.
/.What information do you need to know to determine whether a taxpayer is required to
file a return? - Answer-The taxpayer's marital status, age at the end of the tax year,
gross income for the year, and if the taxpayer is a dependent.
/.Where on Form 1040 can you find the regular standard deduction amounts? - Answer-
In the left-hand margin on page 1 of Form 1040. They are: single and married filing
separately, $12,200; married filing jointly and qualifying widow(er), $24,400; and head of
household, $18,350.
/.How much is added to the standard deduction if the taxpayer (or spouse) is age 65 or
older, or blind? - Answer-$1,300 for married taxpayers and qualifying widow(er)s, or
$1,650 for all other unmarried taxpayers, is added for each condition.
/.What is the personal exemption amount for 2019? - Answer-There is no personal
exemption for 2019. A personal exemption was an amount previously allowed by law to
reduce income that would otherwise be taxed. The Tax Cuts and Jobs Act of 2017
repealed this deduction beginning in 2018.
/.How is the gross income filing requirement determined for most taxpayers? - Answer-
The taxpayer's standard deduction, including the additional amounts for age and
blindness. However, for MFS, the amount is $5.
/.What is the difference between injured spouse allocation and innocent spouse relief? -
Answer-The IRS provides an injured spouse allocation for the taxpayer to protect their
, portion of a refund from a spouse's past-due federal income tax, unpaid student loans,
or unpaid child and spousal support, or state income tax.
The IRS provides innocent spouse relief to taxpayers who file a joint return and later
learn that their spouse has underestimated income (or overstated a credit or deduction)
on the return.
/.What is a thorough interview? - Answer-A thorough interview consists of asking
general information questions, then asking additional questions whenever information is
incomplete or seems inaccurate or inconsistent
/.What is a conflict of interest? - Answer-Circular 230 states that a conflict of interest
exists if the representation of one client will be directly adverse to another client, or if
there is a significant risk that the representation of one or more clients will be materially
limited by the practitioner's responsibilities to another client, a former client, or a third
person, or by a personal interest of the practitioner.
/.What actions can resolve a conflict of interest? - Answer-A conflict of interest is
resolved when it is acknowledged, disclosed to all parties, and the parties have
consented to waiving the conflict.
/.What taxpayer information is confidential? - Answer-Any information that could
potentially identify the taxpayer is confidential. Information includes (but is not limited to)
name, address and phone number, social security number, place of employment, and
any information from a tax return.
/.What is a tax preparer's responsibility upon finding out that a taxpayer has not
complied with one or more tax laws? - Answer-A tax preparer must only advise the
taxpayer of the noncompliance and the consequences for not correcting the situation.
The taxpayer is the only individual who can decide to make corrections to their return.
/.What action should a tax preparer take if a taxpayer insists on reporting information
that is inaccurate? - Answer-A tax preparer may not sign a return reporting clearly
inaccurate information or otherwise assist a taxpayer in filing an inaccurate return.
/.A tax preparer may not sign a return reporting clearly inaccurate information or
otherwise assist a taxpayer in filing an inaccurate return. - Answer-The dependent must
be a qualifying child or qualifying relative; they must be a U.S. citizen or a resident of
the United States, Canada, or Mexico; they cannot file a joint return (unless solely to
claim a refund of taxes paid); and the taxpayer claiming the dependent must not be a
dependent of another taxpayer.
/.What are the five tests for a qualifying child? - Answer-Relationship test.
Age test.
Residency test.
Support test.
Joint return test.
