Enrolled Agent part 1
Lauren and Ralph divorces in four years ago. They have a 12 year old child, Amy who
lives with Lauren. All are US citizens and have SSNs. Lauren and ralph provide more
than half for Amy support. lauren AGI is $31,000 ans Ralph's is 39,000. The divorce
decree doesn't state who can claim the child. Lauren signed form 8332 to give the
dependency exemption to Ralph. Which of the following statement is True? - ANS-C.
Since Lauren signed Form 8332, the dependency exemption and the Child Tax Credit is
given to Ralph, the non-custodial parent. However, Lauren can still file as HOH and
claim the EIC and Child and Dependent Care Credit based on Amy, as long as she
otherwise qualify for them.
The Life Learning Credit is different from American Opportunity Credit. However, they
do share some of the same requirements. Which of the following requirements is true
for both education credits? - ANS-D. Taxpayers who use the filling status of Married
Filling Separately are not eligible to claim either the American Opportunity or Lifetime
Learning Credits.
Which of the following items is not tax-deductible as an education related expense for
the Lifetime Learning Credit
A. Required books
B.Childcare in order to attend class
C. Tuition
D. Requirement fees - ANS-B. Daycare is not a qualifying education expense. For
purposes of the Lifetime Learning Credit, qualified education expenses are tuition and
certain related expenses requires for enrollment and attendance at en eligible
educational institution.
Edwin is a professional bookkeeper. He decides to take an accounting course at the
local community college in order to improve his skills. Edwin is not a degree candidate.
Which education credit does he qualify for?
A. The American Opportunity Credit
B. The College Credit
C. The Lifetime Learning Credit
D. The Mortgage Interest Credit - ANS-C. The Lifetime Learning Credit. He is not qualify
for the AOC because he is not a degree candidate. The College Credit doesn't exist.
The Mortgage Interest is not a education credit.
, Which of the following expenses is not a qualified adoption expense for the purposes of
Adoption Credit
A. Court cost
B. Re-adoption expenses to adopt a foreign child
C. Attorney fees for a surrogate arrangement
D. Travel expense - ANS-C. The cost of a surrogate arrangement is not a qualified
adoption expense. Qualify adoption expenses are expenses directly related to the legal
adoption of an eligible child. These expenses include, adoption fees, travel expenses,
and re-adoption expenses to adopt a foreign child.
Which tax form is used to claim an Adoption Credit?
A. Form 8839
B. Form 2815
C. Schedule A
D. Schedule C - ANS-A. Form 8839
Which of the following taxpayers, all of whom are covered by employer retirement plans,
are entitled to partially deduction for their traditional IRA contribution?
A. Evan, who is single and has a modified AGI of $86,000
B. Connie, Who's MFJ and has a modified AGI of $111,000
C. Gave, who is MFS and has a modified AGI of $8,500
D. Calvin, qualifying windowed, modified AGI of $110,500 - ANS-C. According to IRA
deduction-out ranges, Gabe's allowable traditional IRA deduction is reduced because
his modified AGI is less than $10,000. All of the other taxpayers listed have AGI limits
that exceed the threshold.
Hubert and Felicity have a MAGI of $45,000. They are married and file joint return. Two
years ago, they todos out a loan so Hubert's mother Miranda could learn her degree.
They do not claim Miranda as a dependent on their return. In 2010, they paid $3,000 in
student loan interest. Miranda also earn a scholarship of $2,000. How much student
loan interest can Hubert and Felicity deduct on their tax return? - ANS-Because his
mother is not their dependent, they cannot deduct any part of the loan from their
income.
Which IRS form is used to report a non-deductible retirement plan contributions?
A. Form 8606
B. Form 1040
C. Form 8886
D. Form 8889 - ANS-A. To designate IRA contributions as no deductible, a taxpayer
must file form 8606.
Lauren and Ralph divorces in four years ago. They have a 12 year old child, Amy who
lives with Lauren. All are US citizens and have SSNs. Lauren and ralph provide more
than half for Amy support. lauren AGI is $31,000 ans Ralph's is 39,000. The divorce
decree doesn't state who can claim the child. Lauren signed form 8332 to give the
dependency exemption to Ralph. Which of the following statement is True? - ANS-C.
Since Lauren signed Form 8332, the dependency exemption and the Child Tax Credit is
given to Ralph, the non-custodial parent. However, Lauren can still file as HOH and
claim the EIC and Child and Dependent Care Credit based on Amy, as long as she
otherwise qualify for them.
The Life Learning Credit is different from American Opportunity Credit. However, they
do share some of the same requirements. Which of the following requirements is true
for both education credits? - ANS-D. Taxpayers who use the filling status of Married
Filling Separately are not eligible to claim either the American Opportunity or Lifetime
Learning Credits.
Which of the following items is not tax-deductible as an education related expense for
the Lifetime Learning Credit
A. Required books
B.Childcare in order to attend class
C. Tuition
D. Requirement fees - ANS-B. Daycare is not a qualifying education expense. For
purposes of the Lifetime Learning Credit, qualified education expenses are tuition and
certain related expenses requires for enrollment and attendance at en eligible
educational institution.
Edwin is a professional bookkeeper. He decides to take an accounting course at the
local community college in order to improve his skills. Edwin is not a degree candidate.
Which education credit does he qualify for?
A. The American Opportunity Credit
B. The College Credit
C. The Lifetime Learning Credit
D. The Mortgage Interest Credit - ANS-C. The Lifetime Learning Credit. He is not qualify
for the AOC because he is not a degree candidate. The College Credit doesn't exist.
The Mortgage Interest is not a education credit.
, Which of the following expenses is not a qualified adoption expense for the purposes of
Adoption Credit
A. Court cost
B. Re-adoption expenses to adopt a foreign child
C. Attorney fees for a surrogate arrangement
D. Travel expense - ANS-C. The cost of a surrogate arrangement is not a qualified
adoption expense. Qualify adoption expenses are expenses directly related to the legal
adoption of an eligible child. These expenses include, adoption fees, travel expenses,
and re-adoption expenses to adopt a foreign child.
Which tax form is used to claim an Adoption Credit?
A. Form 8839
B. Form 2815
C. Schedule A
D. Schedule C - ANS-A. Form 8839
Which of the following taxpayers, all of whom are covered by employer retirement plans,
are entitled to partially deduction for their traditional IRA contribution?
A. Evan, who is single and has a modified AGI of $86,000
B. Connie, Who's MFJ and has a modified AGI of $111,000
C. Gave, who is MFS and has a modified AGI of $8,500
D. Calvin, qualifying windowed, modified AGI of $110,500 - ANS-C. According to IRA
deduction-out ranges, Gabe's allowable traditional IRA deduction is reduced because
his modified AGI is less than $10,000. All of the other taxpayers listed have AGI limits
that exceed the threshold.
Hubert and Felicity have a MAGI of $45,000. They are married and file joint return. Two
years ago, they todos out a loan so Hubert's mother Miranda could learn her degree.
They do not claim Miranda as a dependent on their return. In 2010, they paid $3,000 in
student loan interest. Miranda also earn a scholarship of $2,000. How much student
loan interest can Hubert and Felicity deduct on their tax return? - ANS-Because his
mother is not their dependent, they cannot deduct any part of the loan from their
income.
Which IRS form is used to report a non-deductible retirement plan contributions?
A. Form 8606
B. Form 1040
C. Form 8886
D. Form 8889 - ANS-A. To designate IRA contributions as no deductible, a taxpayer
must file form 8606.
