Solution Manual With Appendix For Income Tax Fundamentals
2023, 41st Edition By Gerald E. Whittenburg, Steven Gill
,Group 1 – Multiple Choice Questions
1. D The Income Tax Includes Elements Of 20. C Surviving Spouse Is Preferred To Head
Social And Economic Policy (Lo 1.1) Of Household (Lo 1.5)
2. C The Income Tax Was Authorized By The 21. E Either Margaret Or Her Sister (But Not
16th Amendment In 1913 (Lo 1.1) Both) May Claim The Mother As A
3. C The 1040a And 1040-Ez No Longer Exist Dependent Under A Multiple Support
And The 1120 Is For Corporations (Lo Agreement (Lo 1.6)
1.2) 22. D The Daughter Fails The Age Test To
4. D Partnerships Use Form 1065 To Be A Qualifying Child And She Fails
Report Income Tax Information. A The Gross Income Test ($4,400 In
Partner Will Report Their Share Of 2022) To Be A Qualifying Relative
Income From A Part- Nership On A (Lo 1.6)
Form1040 (Lo 1.2) 23. D The Child Tax Credit In 2022 Is
5. D Capital Gains And Losses Are $2,000 (Lo 1.6)
Reported Directly On The Face Of 24. B The Child Tax Credit For The 13-Year-Old
The Form 1040 (From Schedule D) Child Is $2,000. The Mother Does Not
(Lo 1.2) Meet The Support Test And Cannot Be
6. D A Partnership Is Not Generally A Tax- Claimed (Lo 1.6)
Paying Entity (Lo 1.2) 25. B Must Be Age 16 Or Under For Child Tax
7. C Student Loan Interest Is A For Agi Credit (Lo 1.6)
Deduction. The Other Responses Are All 26. A Head Of Household Standard Deduction
Itemized (From Agi) Deductions (Lo 1.3) Plus Additional Standard Deduction For
8. B The Deduction For Ira Contributions Is Age 65 ($19,400 + $1,750) (Lo 1.7)
A For Agi Deduction (Lo 1.3) 27. B Taxpayers Age 65 Or Older Are
9. D $98,000 – $13,000 (Standard Deduction Eligible For An Additional Standard
Is Less Than Itemized Deductions) (Lo Deduction Amount (Lo 1.7)
1.3) 28. B Taxpayers That Are Blind Are Eligible
10. D For Agi Adjustments Are Deducted To For An Additional Standard Deduction
Get To Agi (Lo 1.3) Amount (Lo 1.7)
11. B The Larger Of The Two May Be 29. D Earned Income Plus $400 (Lo 1.7)
Deducted (Lo 1.3) 30. E Standard Deduction May Not Exceed
12. A An Exclusion Reduces Gross Income (Lo Typical Amount (Lo 1.7)
1.3) 31. D Business Inventory Is Not Considered
13. B Filing Thresholds Generally Are The Same A Capital Asset (Lo 1.8)
As The Standard Deduction Amount (Lo 32. A Gain Of $15,000 ($25,000 Amount
1.4) Realized Less $10,000 Adjusted Basis)
14. D Ben’s Income Would Need To Exceed Has Been Held For More Than 12 Months
The Standard Deduction To Require And Is Long-Term (Lo 1.8)
Filing A Tax Return (Lo 1.4) 33. C $10,000 = $240,000 – ($270,000 – $40,000)
15. D $25,900 + $1,400 (Lo 1.4) (Lo 1.8)
16. C Single Dependent Over 65 And Blind 34. A $43,000 – $3,000. Net Capital Losses Of
Thresh- Old Is $4,500 For Unearned Up To $3,000 May Be Deducted From
Income (Lo 1.4) Ordinary Income For Individual
17. C Joan Qualifies As Either Single Or Head Taxpayers (Lo 1.8)
Of Household; However, Head Of 35. C Line 7 Is Capital Gain Or (Loss) (Lo 1.9)
Household Is More Advantageous (Lo 36. B Preparers Must Get A Signed Authorization
1.5) To E-File From The Taxpayer. (Lo 1.10)
18. D Although Dorothy Does Not Live With 37. B About 90% Of Returns Are Filed
Glenda, Since Dorothy Is A Parent That Electronically (Lo 1.10)
Glenda Supports, Glenda May File As
Head Of Household (Lo 1.5)
19. D Taxpayer May File Married Filing Jointly
In Year Of Spouse’s Death (Lo 1.5)
,
, 1-2 Chapter 1 – The Individual Income Tax Return
1-1
Group 2 – Problems
1. A. Raising Revenue To Operate The Government.
b. Furthering Economic Goals Such As Reducing Unemployment.
c. Furthering Social Goals Such As Encouraging Contributions To Charities. (Lo 1.1)
2. A. Form 1040
b. Schedule B
c. Schedule D
d. Schedule A
e. Schedule 2
f. Schedule E
g. Schedule 3
h. Schedule C
i. Schedule 1 (Lo 1.2)
3. A. $36,300 = $42,000 + $300 – $6,000.
b. $25,900, The Greater Of Itemized Deductions Or The Standard Deduction Of $25,900.
c. $10,400 = $36,300 – $25,900. (Lo 1.3)
4. A. $25,000.
b. $12,950, The Greater Of Total Itemized Deductions Or The Standard Deduction Amount.
c. $12,050 = $25,000 – $12,950. (Lo 1.3)
5. A. $53,800 = $54,000 + $2,800 – $3,000 ($7,000 Capital Loss Limited To $3,000).
b. $12,950
c. $40,850 = $53,800 – $12,950. (Lo 1.3 And 1.8)
6. A. $47,500 = $48,000 + $2,500 – $3,000.
b. $25,900, The Greater Of Itemized Deductions Or The Standard Deduction Of $25,900.
c. $21,600 = $47,500 – $25,900.
d. $2,184 (Tax Table) (Lo 1.3, 1.5, And 1.7)
7. Adjusted Gross Income $18,000
Less: Itemized Deductions –2,400
Taxable Income $15,600
Marco’s Tax Liability From The Tax Table Is $1,670. Note: Because They Are Married And Filing Separately And
Mar- Co’s Spouse Tatiana Itemizes Her Deductions, Marco Must Also Itemize His Deductions, Even Though The
Itemized Deductions Total Is Less Than The Standard Deduction He Would Be Otherwise Entitled To. (Lo
1.3, 1.5, And 1.7)
8. Adjusted Gross Income ($13,200 + $1,450) $ 14,650
Less: Standard Deduction –12,950
Taxable Income $ 1,700
(Lo 1.3, 1.5, And 1.7)
(Note: See Chapter 6 For The Tax Credit Computation For Dependent College Students Under Age 24.)
9. A. $34,050 = $47,000 – $12,950.
b. Tax Tables. Taxpayers With Income Up To $100,000 Must Use The Tax Tables.
c. $3,884. (Lo 1.3, 1.5, And 1.7)
10. A. $66,000 = $50,000 + $8,000 + $5,000 + $3,000.
b. $63,500 = $66,000 – $2,500.
c. $27,000, The Greater Of Itemized Deductions Or The Standard Deduction Of $25,900.
d. $36,500 = $63,500 – $27,000.
e. $3,972 (Lo 1.3, 1.5, And 1.7)
2023, 41st Edition By Gerald E. Whittenburg, Steven Gill
,Group 1 – Multiple Choice Questions
1. D The Income Tax Includes Elements Of 20. C Surviving Spouse Is Preferred To Head
Social And Economic Policy (Lo 1.1) Of Household (Lo 1.5)
2. C The Income Tax Was Authorized By The 21. E Either Margaret Or Her Sister (But Not
16th Amendment In 1913 (Lo 1.1) Both) May Claim The Mother As A
3. C The 1040a And 1040-Ez No Longer Exist Dependent Under A Multiple Support
And The 1120 Is For Corporations (Lo Agreement (Lo 1.6)
1.2) 22. D The Daughter Fails The Age Test To
4. D Partnerships Use Form 1065 To Be A Qualifying Child And She Fails
Report Income Tax Information. A The Gross Income Test ($4,400 In
Partner Will Report Their Share Of 2022) To Be A Qualifying Relative
Income From A Part- Nership On A (Lo 1.6)
Form1040 (Lo 1.2) 23. D The Child Tax Credit In 2022 Is
5. D Capital Gains And Losses Are $2,000 (Lo 1.6)
Reported Directly On The Face Of 24. B The Child Tax Credit For The 13-Year-Old
The Form 1040 (From Schedule D) Child Is $2,000. The Mother Does Not
(Lo 1.2) Meet The Support Test And Cannot Be
6. D A Partnership Is Not Generally A Tax- Claimed (Lo 1.6)
Paying Entity (Lo 1.2) 25. B Must Be Age 16 Or Under For Child Tax
7. C Student Loan Interest Is A For Agi Credit (Lo 1.6)
Deduction. The Other Responses Are All 26. A Head Of Household Standard Deduction
Itemized (From Agi) Deductions (Lo 1.3) Plus Additional Standard Deduction For
8. B The Deduction For Ira Contributions Is Age 65 ($19,400 + $1,750) (Lo 1.7)
A For Agi Deduction (Lo 1.3) 27. B Taxpayers Age 65 Or Older Are
9. D $98,000 – $13,000 (Standard Deduction Eligible For An Additional Standard
Is Less Than Itemized Deductions) (Lo Deduction Amount (Lo 1.7)
1.3) 28. B Taxpayers That Are Blind Are Eligible
10. D For Agi Adjustments Are Deducted To For An Additional Standard Deduction
Get To Agi (Lo 1.3) Amount (Lo 1.7)
11. B The Larger Of The Two May Be 29. D Earned Income Plus $400 (Lo 1.7)
Deducted (Lo 1.3) 30. E Standard Deduction May Not Exceed
12. A An Exclusion Reduces Gross Income (Lo Typical Amount (Lo 1.7)
1.3) 31. D Business Inventory Is Not Considered
13. B Filing Thresholds Generally Are The Same A Capital Asset (Lo 1.8)
As The Standard Deduction Amount (Lo 32. A Gain Of $15,000 ($25,000 Amount
1.4) Realized Less $10,000 Adjusted Basis)
14. D Ben’s Income Would Need To Exceed Has Been Held For More Than 12 Months
The Standard Deduction To Require And Is Long-Term (Lo 1.8)
Filing A Tax Return (Lo 1.4) 33. C $10,000 = $240,000 – ($270,000 – $40,000)
15. D $25,900 + $1,400 (Lo 1.4) (Lo 1.8)
16. C Single Dependent Over 65 And Blind 34. A $43,000 – $3,000. Net Capital Losses Of
Thresh- Old Is $4,500 For Unearned Up To $3,000 May Be Deducted From
Income (Lo 1.4) Ordinary Income For Individual
17. C Joan Qualifies As Either Single Or Head Taxpayers (Lo 1.8)
Of Household; However, Head Of 35. C Line 7 Is Capital Gain Or (Loss) (Lo 1.9)
Household Is More Advantageous (Lo 36. B Preparers Must Get A Signed Authorization
1.5) To E-File From The Taxpayer. (Lo 1.10)
18. D Although Dorothy Does Not Live With 37. B About 90% Of Returns Are Filed
Glenda, Since Dorothy Is A Parent That Electronically (Lo 1.10)
Glenda Supports, Glenda May File As
Head Of Household (Lo 1.5)
19. D Taxpayer May File Married Filing Jointly
In Year Of Spouse’s Death (Lo 1.5)
,
, 1-2 Chapter 1 – The Individual Income Tax Return
1-1
Group 2 – Problems
1. A. Raising Revenue To Operate The Government.
b. Furthering Economic Goals Such As Reducing Unemployment.
c. Furthering Social Goals Such As Encouraging Contributions To Charities. (Lo 1.1)
2. A. Form 1040
b. Schedule B
c. Schedule D
d. Schedule A
e. Schedule 2
f. Schedule E
g. Schedule 3
h. Schedule C
i. Schedule 1 (Lo 1.2)
3. A. $36,300 = $42,000 + $300 – $6,000.
b. $25,900, The Greater Of Itemized Deductions Or The Standard Deduction Of $25,900.
c. $10,400 = $36,300 – $25,900. (Lo 1.3)
4. A. $25,000.
b. $12,950, The Greater Of Total Itemized Deductions Or The Standard Deduction Amount.
c. $12,050 = $25,000 – $12,950. (Lo 1.3)
5. A. $53,800 = $54,000 + $2,800 – $3,000 ($7,000 Capital Loss Limited To $3,000).
b. $12,950
c. $40,850 = $53,800 – $12,950. (Lo 1.3 And 1.8)
6. A. $47,500 = $48,000 + $2,500 – $3,000.
b. $25,900, The Greater Of Itemized Deductions Or The Standard Deduction Of $25,900.
c. $21,600 = $47,500 – $25,900.
d. $2,184 (Tax Table) (Lo 1.3, 1.5, And 1.7)
7. Adjusted Gross Income $18,000
Less: Itemized Deductions –2,400
Taxable Income $15,600
Marco’s Tax Liability From The Tax Table Is $1,670. Note: Because They Are Married And Filing Separately And
Mar- Co’s Spouse Tatiana Itemizes Her Deductions, Marco Must Also Itemize His Deductions, Even Though The
Itemized Deductions Total Is Less Than The Standard Deduction He Would Be Otherwise Entitled To. (Lo
1.3, 1.5, And 1.7)
8. Adjusted Gross Income ($13,200 + $1,450) $ 14,650
Less: Standard Deduction –12,950
Taxable Income $ 1,700
(Lo 1.3, 1.5, And 1.7)
(Note: See Chapter 6 For The Tax Credit Computation For Dependent College Students Under Age 24.)
9. A. $34,050 = $47,000 – $12,950.
b. Tax Tables. Taxpayers With Income Up To $100,000 Must Use The Tax Tables.
c. $3,884. (Lo 1.3, 1.5, And 1.7)
10. A. $66,000 = $50,000 + $8,000 + $5,000 + $3,000.
b. $63,500 = $66,000 – $2,500.
c. $27,000, The Greater Of Itemized Deductions Or The Standard Deduction Of $25,900.
d. $36,500 = $63,500 – $27,000.
e. $3,972 (Lo 1.3, 1.5, And 1.7)
