HRB-27 FINAL EXAM QUESTIONS
AND VERIFIED ANSWER; 100%
CORRECT; 2026- 2027 UPDATE
A single self-employed taxpayer estimates that his 2009
tax will be $7,500. His 2008 tax was $7,000. How much
must he prepay for 2009 in order to avoid an
underpayment penalty? - correct answer-
$6,750; the lesser of 90% of his 2009 tax [$7,500 X 90% =
$6,750] or 100% of his 2008 tax ($7,000). (24.)
A taxpayer is building a new home and had a solar water
heater installed in 2009, but the home was not ready to
be occupied until early 2010. Can they take the residential
energy credit? - correct answer- Yes, they can
take the credit on their 2010 tax return. (8.21)
A taxpayer makes his final 2008 state estimated tax
payment on January 15, 2009. Where should he report
this item? - correct answer- It is included on his
2009 Schedule A, line 5. This payment also should have
,been included on the estimated payments line of his 2008
state return.
A taxpayer wants to amend his 2006 return. He filed it
April 16, 2007. The return was examined by the IRS on
January 9, 2009 and $280 additional tax was paid that
date. What is the latest date on which an amended return
may be filed? - correct answer- January 9, 2011
Any refund will be limited to $280 (the tax paid within the
two years preceding the date the amended return was
filed). (23.3)
A taxpayer wrote a check for a $500 donation to his
mosque. Is his cancelled check sufficient documentation
to support his deduction? - correct answer- No.
Donations of $250 or more must have written
substantiation from the donee. (12.29)
A taxpayer's employer paid $500 of a taxpayer's $2,000
child care expenses for him. How will the employer's
assistance affect the child-care credit? - correct
answer- Total child care expenses must be reduced
by any amounts paid by the employer. (8.11)
,An employee has an office where he works, but his work
load demands that he bring home work on evenings and
weekends. He uses a room of his home regularly and
exclusively for his work. May he deduct home-office
expenses? - correct answer- No, the employer
provides a work office. (17.23)
Are early distributions from qualified retirement plans
always penalized? - correct answer- No.
• Does not apply to qualified disaster recovery assistance
distributions.
• Does not apply to any recovery of cost or any amount
rolled over in a timely manner.
(22.12,13)
Are scholarships and fellowships taxable? - correct
answer- • If a W-2 is received it is FULLY taxable.
• Amounts to Non-degree candidates are FULLY taxable
and reported on Line 7 marked "SCH"
, • Amounts to Degree candidates spent for qualified
expenses are NOT taxable. (18.5)
At what amount must interest income be reported on
Form 1040, Schedule B? - correct answer-
When the total taxable interest exceeds $1,500 (6.2)
Carol has a home office. When she is not using the office,
she lets her children play video games on an old television
she keeps there. Can Carol deduct home-office expenses?
- correct answer- No. The space must be used
exclusively for the business. (17.21)
Define basis. - correct answer- A measure of
the taxpayer's investment in property for tax purposes.
(20.4)
For MACRS purposes, we need to divide real property into
two categories. What are they? - correct answer-
Residential and Nonresidential (16.7)
AND VERIFIED ANSWER; 100%
CORRECT; 2026- 2027 UPDATE
A single self-employed taxpayer estimates that his 2009
tax will be $7,500. His 2008 tax was $7,000. How much
must he prepay for 2009 in order to avoid an
underpayment penalty? - correct answer-
$6,750; the lesser of 90% of his 2009 tax [$7,500 X 90% =
$6,750] or 100% of his 2008 tax ($7,000). (24.)
A taxpayer is building a new home and had a solar water
heater installed in 2009, but the home was not ready to
be occupied until early 2010. Can they take the residential
energy credit? - correct answer- Yes, they can
take the credit on their 2010 tax return. (8.21)
A taxpayer makes his final 2008 state estimated tax
payment on January 15, 2009. Where should he report
this item? - correct answer- It is included on his
2009 Schedule A, line 5. This payment also should have
,been included on the estimated payments line of his 2008
state return.
A taxpayer wants to amend his 2006 return. He filed it
April 16, 2007. The return was examined by the IRS on
January 9, 2009 and $280 additional tax was paid that
date. What is the latest date on which an amended return
may be filed? - correct answer- January 9, 2011
Any refund will be limited to $280 (the tax paid within the
two years preceding the date the amended return was
filed). (23.3)
A taxpayer wrote a check for a $500 donation to his
mosque. Is his cancelled check sufficient documentation
to support his deduction? - correct answer- No.
Donations of $250 or more must have written
substantiation from the donee. (12.29)
A taxpayer's employer paid $500 of a taxpayer's $2,000
child care expenses for him. How will the employer's
assistance affect the child-care credit? - correct
answer- Total child care expenses must be reduced
by any amounts paid by the employer. (8.11)
,An employee has an office where he works, but his work
load demands that he bring home work on evenings and
weekends. He uses a room of his home regularly and
exclusively for his work. May he deduct home-office
expenses? - correct answer- No, the employer
provides a work office. (17.23)
Are early distributions from qualified retirement plans
always penalized? - correct answer- No.
• Does not apply to qualified disaster recovery assistance
distributions.
• Does not apply to any recovery of cost or any amount
rolled over in a timely manner.
(22.12,13)
Are scholarships and fellowships taxable? - correct
answer- • If a W-2 is received it is FULLY taxable.
• Amounts to Non-degree candidates are FULLY taxable
and reported on Line 7 marked "SCH"
, • Amounts to Degree candidates spent for qualified
expenses are NOT taxable. (18.5)
At what amount must interest income be reported on
Form 1040, Schedule B? - correct answer-
When the total taxable interest exceeds $1,500 (6.2)
Carol has a home office. When she is not using the office,
she lets her children play video games on an old television
she keeps there. Can Carol deduct home-office expenses?
- correct answer- No. The space must be used
exclusively for the business. (17.21)
Define basis. - correct answer- A measure of
the taxpayer's investment in property for tax purposes.
(20.4)
For MACRS purposes, we need to divide real property into
two categories. What are they? - correct answer-
Residential and Nonresidential (16.7)
