H&R Block Final Review UPDATED
ACTUAL Exam Questions and CORRECT
Answers
What is a tax preparer's responsibility upon finding out that a taxpayer has not complied with one
or more tax laws? - CORRECT 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? - CORRECT 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. - CORRECT 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? - CORRECT ANSWER - Relationship test.
Age test.
Residency test.
Support test.
Joint return test.
How can a married individual meet the joint return test to remain a qualifying child? -
CORRECT ANSWER - They can meet this test by not filing a joint return with their
spouse, or they can file a joint return with their spouse if they are filing only to claim a refund of
any taxes withheld.
,How can you determine who paid more than half of a person's support? - CORRECT
ANSWER - The amount of total support is reduced by the funds received for the person
from all sources other than the taxpayer. Other sources of support might include relatives,
government programs, and the dependent's own income.
What happens if an individual is a qualifying child of more than one taxpayer? - CORRECT
ANSWER - If more than one taxpayer claims the dependent, the IRS will apply the
tiebreaker rules to award the qualifying child to one of the taxpayers.
What four tests must be met for an individual to be considered a qualifying relative? -
CORRECT ANSWER - 1.Relationship or member of the household for the entire year.
2.Gross income.
3.Support.
4.Not a qualifying child of someone else.
How can the gross income test for a qualifying relative be satisfied? - CORRECT
ANSWER - The qualifying relative's gross income must be less than $4,200. When
determining the gross income, tax-exempt income, such as certain social security benefits, is not
included.
What is the purpose of Form 2120, Multiple Support Declaration? - CORRECT
ANSWER - If two or more persons combined provided over one-half of a person's
support, they may together agree to allow any one of them who contributed at least 10% of the
support to claim the exemption. A statement waiving the right to claim the dependency
exemption should be signed by each contributor who is not claiming the exemption, and retained
by the one who is. Form 2120 is attached to the return of the taxpayer claiming the exemption.
How much is the Child Tax Credit worth? - CORRECT ANSWER - Up to $2,000 per
qualifying child.
What additional requirements must be met for a taxpayer to be eligible to claim the Child Tax
Credit for their qualifying child? - CORRECT ANSWER - The child must:
, Be a qualifying child who is the taxpayer's dependent and who has not reached their 17th
birthday by the end of the year.
Have a social security valid for employment before the due date of the return.
Be a citizen, national, or resident of the United States.
Is the Child Tax Credit refundable or nonrefundable? - CORRECT ANSWER - The Child
Tax Credit is nonrefundable. However, certain taxpayers may qualify for the Additional Child
Tax Credit, which is refundable.
The Child Tax Credit is nonrefundable. However, certain taxpayers may qualify for the
Additional Child Tax Credit, which is refundable. - CORRECT ANSWER - There is a
$530 penalty for failing to meet the CTC/ODC/ACTC due diligence requirement on one
taxpayer's return.
What is the first due diligence requirement for the EITC, CTC/ACTC, ODC, AOTC, and/or head
of household filing status, and how does a paid preparer meet this requirement? - CORRECT
ANSWER - Complete and submit Form 8867, Paid Preparer's Earned Income Credit
Checklist.
The form must be completed thoroughly and conscientiously by the paid preparer. One Form
8867 must be submitted with every e-filed or paper-filed return (original and/or amended) for
every taxpayer who claims the EITC, CTC/ODC/ACTC, AOTC, and/or uses the head of
household filing status.
What filing statuses are available to taxpayers who are unmarried? - CORRECT
ANSWER - Qualifying widow(er), head of household, and single.
How may a married taxpayer qualify as unmarried for tax purposes? - CORRECT
ANSWER - To qualify as unmarried for the purpose of claiming the head of household
filing status, a taxpayer must meet all of the following:
Not file a joint return with their spouse.
Provide more than half the cost of maintaining their home.
The home must be the main home for the taxpayer and their dependent child (or child who would
be a dependent except that the exemption was given to the noncustodial parent) for more than six
months of the tax year.
ACTUAL Exam Questions and CORRECT
Answers
What is a tax preparer's responsibility upon finding out that a taxpayer has not complied with one
or more tax laws? - CORRECT 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? - CORRECT 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. - CORRECT 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? - CORRECT ANSWER - Relationship test.
Age test.
Residency test.
Support test.
Joint return test.
How can a married individual meet the joint return test to remain a qualifying child? -
CORRECT ANSWER - They can meet this test by not filing a joint return with their
spouse, or they can file a joint return with their spouse if they are filing only to claim a refund of
any taxes withheld.
,How can you determine who paid more than half of a person's support? - CORRECT
ANSWER - The amount of total support is reduced by the funds received for the person
from all sources other than the taxpayer. Other sources of support might include relatives,
government programs, and the dependent's own income.
What happens if an individual is a qualifying child of more than one taxpayer? - CORRECT
ANSWER - If more than one taxpayer claims the dependent, the IRS will apply the
tiebreaker rules to award the qualifying child to one of the taxpayers.
What four tests must be met for an individual to be considered a qualifying relative? -
CORRECT ANSWER - 1.Relationship or member of the household for the entire year.
2.Gross income.
3.Support.
4.Not a qualifying child of someone else.
How can the gross income test for a qualifying relative be satisfied? - CORRECT
ANSWER - The qualifying relative's gross income must be less than $4,200. When
determining the gross income, tax-exempt income, such as certain social security benefits, is not
included.
What is the purpose of Form 2120, Multiple Support Declaration? - CORRECT
ANSWER - If two or more persons combined provided over one-half of a person's
support, they may together agree to allow any one of them who contributed at least 10% of the
support to claim the exemption. A statement waiving the right to claim the dependency
exemption should be signed by each contributor who is not claiming the exemption, and retained
by the one who is. Form 2120 is attached to the return of the taxpayer claiming the exemption.
How much is the Child Tax Credit worth? - CORRECT ANSWER - Up to $2,000 per
qualifying child.
What additional requirements must be met for a taxpayer to be eligible to claim the Child Tax
Credit for their qualifying child? - CORRECT ANSWER - The child must:
, Be a qualifying child who is the taxpayer's dependent and who has not reached their 17th
birthday by the end of the year.
Have a social security valid for employment before the due date of the return.
Be a citizen, national, or resident of the United States.
Is the Child Tax Credit refundable or nonrefundable? - CORRECT ANSWER - The Child
Tax Credit is nonrefundable. However, certain taxpayers may qualify for the Additional Child
Tax Credit, which is refundable.
The Child Tax Credit is nonrefundable. However, certain taxpayers may qualify for the
Additional Child Tax Credit, which is refundable. - CORRECT ANSWER - There is a
$530 penalty for failing to meet the CTC/ODC/ACTC due diligence requirement on one
taxpayer's return.
What is the first due diligence requirement for the EITC, CTC/ACTC, ODC, AOTC, and/or head
of household filing status, and how does a paid preparer meet this requirement? - CORRECT
ANSWER - Complete and submit Form 8867, Paid Preparer's Earned Income Credit
Checklist.
The form must be completed thoroughly and conscientiously by the paid preparer. One Form
8867 must be submitted with every e-filed or paper-filed return (original and/or amended) for
every taxpayer who claims the EITC, CTC/ODC/ACTC, AOTC, and/or uses the head of
household filing status.
What filing statuses are available to taxpayers who are unmarried? - CORRECT
ANSWER - Qualifying widow(er), head of household, and single.
How may a married taxpayer qualify as unmarried for tax purposes? - CORRECT
ANSWER - To qualify as unmarried for the purpose of claiming the head of household
filing status, a taxpayer must meet all of the following:
Not file a joint return with their spouse.
Provide more than half the cost of maintaining their home.
The home must be the main home for the taxpayer and their dependent child (or child who would
be a dependent except that the exemption was given to the noncustodial parent) for more than six
months of the tax year.
